4-hour timeframe
The amplitude of the last 5 days (high-low): 93 p-116 p-93p133 p-108 p.
Average amplitude for the last 5 days: 108 p (99 p).
In recent days, the British pound moves almost identically with the EUR/USD pair. In this case, we can not even say that the US dollar is more expensive, as the next round of the downward movement began at the EU summit, when it became clear that the UK and Brussels could not agree once again. The phrase that there is an even higher probability of an unregulated Brexit continues to be heard from all sides. In the UK itself, talk about the possible resignation of Theresa May does not subside. The dissatisfaction with her plan to exit from the EU, the fact that Brexit can take place without a "deal" at all, also troubling, moreover, every day there are more and more opponents of Brexit, to the extent that a second referendum should be held has been proposed. The British are easy to understand. Leaving the EU on unfavorable conditions with a noticeable deterioration in living standards is not a tempting prospect. And the European Union does not make concessions. Also very expected. The bloc did not express desire to oust Britain. Thus, now it is even difficult to imagine how this whole situation with Brexit will end. And it can end with new resignations in the British government, and a new referendum, or whatever. Naturally, against the background of complete uncertainty on this issue, two (!!!) years after the referendum itself, the British pound continues to decline in the medium and long term. This along with the weak macroeconomic indicators of the country in the first half of 2018, as well as an unsatisfactory report on inflation has not even been taken into account.
Trading recommendations:
The GBP/USD pair resumed its downward movement and almost fulfilled the support level of 1.2880. The price rebound from this level or the MACD indicator reversal upward will serve as a signal for manual reduction of short positions.
Longs can be considered again not earlier than the consolidation of the price above the Kijun-sen line. In this case, the trend will change to an upward one, but now it is still difficult to expect growth, as the pound has no fundamental support.
In addition to the technical picture, fundamental data and the timing of their release should also be taken into account.
Explanation of illustration:
Ichimoku Indicator:
Tenkan-sen-red line.
Kijun-sen – blue line.
Senkou span a – light brown dotted line.
Senkou span B – light purple dotted line.
Chikou span – green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD:
Red line and histogram with white bars in the indicator window.
The material has been provided by InstaForex Company - www.instaforex.com