4-hour timeframe
Technical data:
The upper linear regression channel: direction – down.
The lower linear regression channel: direction – sideways.
The moving average (20; smoothed) – down.
CCI: -78.5633
On Friday, May 10, the British pound is trying to resume the downward movement after a small upward correction. During the last few days, the pair has been steadily falling, working out the previous growth, which was based on expectations and rumors. Since these rumors did not come true, and the British government did not come closer to resolving the situation with Brexit, the pound quite logically resumed the downward movement. Today, the UK will publish the GDP for March, the preliminary value of GDP for the first quarter, and industrial production for March. In the United States, inflation will be released today. All these reports are quite important and can potentially have a strong impact on the movement of the pair. The question is, in whose favor will the news be? The forecasts for Britain's GDP are not bad, but inflation in the US, according to experts, will accelerate. From a technical point of view, a downward movement is more preferable. With fundamental – too. Thus, the reversal of the Heiken Ashi indicator down may signal about the resumption of the downward movement. However, at the time of publication of the above macroeconomic reports, it is recommended to be more cautious and to use stop-loss orders, as sharp price reversals are possible.
Nearest support levels:
S1 – 1.3000
S2 – 1.2939
S3 – 1.2878
Nearest resistance levels:
R1 – 1.3062
R2 – 1.3123
R3 – 1.3184
Trading recommendations:
The GBP/USD pair has overcome the moving. Thus, the trend for the instrument has changed to a downward trend and short positions with the goals of 1.3000 and 1.2939 have become relevant, the first of which has already been worked out. The reversal of the Heiken Ashi down will indicate the completion of the correction.
Buy-positions are recommended to be considered only after the pair is reversed above the moving average with the goals of 1.3062 and 1.3123.
In addition to the technical picture should also take into account the fundamental data and the time of their release.
Explanation of illustrations:
The upper linear regression channel – blue line the unidirectional movement.
The lower linear regression channel – purple line the unidirectional movement.
CCI – 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