4-hour timeframe
The amplitude of the last 5 days (high-low): 93p - 94p - 73p - 156p - 112p.
Average amplitude for the last 5 days: 106p (98p).
The British pound sterling on the second trading day of the week a few hours before the voting in the British Parliament is losing ground against the US currency. It should be noted that the previous day, the House of Lords rejected Theresa May's proposal regarding Brexit. Now it's up to the House of Commons. And then ... what will happen further remains unknown. If the vote fails, then Jeremy Corbyn, the leader of the Labour Party, is ready to put forward a vote of no confidence against May, which will now be considered by the entire parliament, and not just by the Conservative Party, like last time. However, if May's plan is not approved, in principle, this will mean that the current prime minister will leave her post. How does all this affect the pound sterling? We believe that failure in voting is very likely and in the short term will put a lot of pressure on the pound sterling, as it will mean the senselessness of the two-year negotiations with the European Union. Failure with a high probability will also mean a "hard" variant of the country's exit from the EU, which is certainly less attractive financially. There is another option in which a country can remain in the European Union, but for this, at a minimum, it will be necessary to change the government and take advantage of the decision of the European Court regarding Article 50 of the Lisbon Treaty, and at the most hold a new referendum. By the way, about 100 deputies of the European Parliament have already offered the British to think about the new referendum, promising to support the country if it refuses to exit.
Trading recommendations:
The GBP/USD pair is declining ahead of the Brexit vote. We do not recommend to open any positions in the current situation, as it is associated with high risks. The pair can be extremely volatile in the next few hours.
The same applies to sell orders. If you open any position, trying to "predict" the decision of the Parliament and the reaction of the majority of traders, then be sure to put up Stop Loss protective orders.
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.
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