To open long positions on GBP/USD you need:
Buyers of the pound failed to stay at weekly highs, which led to the return of the pair to the area of the lower boundary of the side channel. At the moment, bulls urgently need to return to the resistance of 1.2668, which acts as the middle of the channel. Only in such a scenario, the demand for the pound will return, which will lead to an update of the upper boundary of the side channel of 1.2715, where I recommend taking profits. In the event of a further decline in GBP/USD, only a test of the support range of 1.2615-1.2620 can return buyers to the market. Otherwise, you can open long positions immediately to rebound from a low of 1.2567.
To open short positions on GBP/USD you need:
Sellers will try to keep the pair below the resistance of 1.2668, and the formation of a false breakdown there will be a direct signal to sell the pound with access to the lower boundary of the channel of 1.2620, where the first profit taking will be. Larger sellers will count on updating the new weekly low around 1.2567, where I recommend taking profits. In case of growth above 1.2668 in the first half of the day, short positions can be considered to rebound from 1.2715.
Indicator signals:
Moving averages
Trade is conducted just below the 30-day and 50-day moving average, with the short-term advantage of sellers of the British pound.
Bollinger bands
In the event of a decrease in the pound, support will be provided by the lower limit of the Bollinger Bands indicator in the area of 1.2625, from which you can open long positions. The upward trend may be limited by the upper limit of the channel of 1.2690, from where sellers of the pound will return to the market.
Description of indicators
- MA (moving average) 50 days - yellow
- MA (moving average) 30 days - green
- MACD: fast EMA 12, slow EMA 26, SMA 9
- Bollinger Bands 20
