4-hour timeframe
Technical details:
The upper linear regression channel: direction - up.
The lower linear regression channel: direction - down.
The moving average (20; smoothed) - down.
CCI: -167.0337
The volatility of the GBP/USD currency pair rose slightly yesterday, the dollar went up against the British pound, the downward trend in the pair remained. As we said the day before, the pound passed an important level of 1.3000, which previously restrained it from further depreciation against the US currency. Now, the way down is open. And given the absence of any fundamental background, and certainly positive for the British currency, the obstacles to the continuation of the fall of the pair is very small. Today, the only news that can be paid attention to is the change in the volume of borrowings of the UK public sector, but it is unlikely that this report will cause a serious surge of emotions in the foreign exchange market. In the future, we now expect the pair to fall first to 1.2800, and then to 1.2450. Unless, unexpectedly, there is information that will provide substantial support to the pound. Given the fact that the EU has once again refused to revise the current version of the agreement on Brexit, the hope for such information is extremely small. A few months ago, Theresa May's resignation could have become such information, but now this withdrawal will give nothing. Brexit in any case postponed, and the Prime Minister, in any case, will have to negotiate with Parliament (how – is unknown if the current version of the transaction will remain unchanged) or to abandon Brexit. Perhaps it is the rejection of Brexit that can bring the pound back to life, but this option is now the least possible scenario.
Nearest support levels:
S1 - 1.2909
S2 - 1.2878
Nearest resistance levels:
R1 - 1.2939
R2 - 1.2970
R3 - 1.3000
Trading recommendations:
The pair GBP/USD continues its downward movement. Thus, it is recommended to trade short positions with targets at 1.2909 and 1.2878 before turning Heiken Ashi's indicator to the top, which will indicate a round of upward correction.
Buy orders will become relevant after fixing the pair above the moving average line with targets at 1.3031 and 1.3062. In the current circumstances, this option is unlikely.
In addition to the technical picture should also take into account the fundamental data and the time of their release.
Explanations for illustrations:
The upper linear regression channel is the blue lines of the unidirectional movement.
The lower linear channel is the purple lines of the unidirectional movement.
CCI is the blue line in the indicator regression window.
The moving average (20; smoothed) is the blue line on the price chart.
Murray levels - multi-colored horizontal stripes.
Heiken Ashi is an indicator that colors bars in blue or purple.
The material has been provided by InstaForex Company - www.instaforex.com
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