4-hour timeframe
The amplitude of the last 5 days (high-low): 123p - 97p - 116p - 70p - 126p.
Average amplitude for the last 5 days: 106p (145p).
Yesterday, the British pound ignored the results of the Fed meeting, while the US dollar fell on all fronts, and it also remained indifferent to today's release of retail sales in the UK. Both in monthly and annual terms, retail sales were higher than analysts' forecasts. But it was the US currency that was increasing in price since the very beginning of the European trading session. Meanwhile, the Bank of England left the current interest rate unchanged, the balance of power in voting for the rate change has remained unchanged, and the Bank of England head Mark Carney said that companies are well prepared for the worst scenario of Brexit. He also noted that the consequences would not be as bad as expected even in the event of a "hard" brexit. Markets regarded these statements as a growing likelihood of a "hard" exit from the EU. The fact is that the European Union doubts the sensibility of granting a delay to Theresa May. It failed to convince Parliament and adopt an agreement with the EU. So why does London need a delay? What will it give? Also, the parties differ in terms of this very delay. In general, in the coming days we are waiting for a lot of interesting news relating to the negotiations on Brexit's postponement. Everything can end, even a disordered Brexit. There is also good news: if Brexit is orderly, most experts expect a rate increase from the regulator. But for now it is too early to talk about it. At the moment, the pound fell, so the current trend for the instrument is downward. All indicators are pointing down, and the "dead cross" is strong.
Trading recommendations:
The GBP/USD pair continues to move downwards. Thus, it is now recommended to trade on the decline with targets of 1.3039 and 1.3009.
Long positions can be considered for a target of a resistance level of 1.3459, if the pair overcomes the critical line, since the trend will shift into growth in this case.
In addition to the technical picture should also take into account the fundamental data and the time of their release.
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:
A red line and a histogram with white bars in the indicator window.
The material has been provided by InstaForex Company - www.instaforex.com