24-hour timeframe
There is opposition in any government in any country at all times. Sometimes this opposition simply expresses its opinion, sometimes it is required to adjust the decisions of the government, but in the case of Britain in the last three years, the opposition is needed in order to fight with the prime ministers. Moreover, in the confrontations between Parliament - Theresa May and Parliament - Boris Johnson, most of the neutral public and analysts choose the side of the Parliament, that is, the opposition. What Johnson and May have in common is that they, as leaders of the country, decided that they should, by all means and by any means possible, withdraw the country from the EU, that is, realize the will of citizens expressed in the 2016 referendum. In principle, this is absolutely logical. But the fact that it is necessary to leave the European Union as gently as possible, that is, with a minimum of negative consequences, has always been a concern for the deputies of the Parliament. Moreover, from different parties, and not just Labour, as the main opposition of the Conservatives. Many conservatives did not agree with the policies of both Theresa May and Boris Johnson. Those who were not afraid to express their opinion have already left this party and their posts in Parliament, voluntarily or forcibly. The main problem in the current situation, which does not even allow us to say with certainty which option is the most preferable and safe for the UK, is that the British people actually made the decision, but since the victory of supporters of the EU exit was minimal (52% out of 100%) , then at least 48% of the UK's population will be dissatisfied in any case. If Brexit gives rise to many problems of an economic plan, worsens the lives of citizens, creates problems at the borders and a shortage of goods, then all the bumps will fall right on the government. Therefore, most deputies regularly reject government attempts to withdraw the country from the EU as quickly as possible. If there was a "soft" war with Theresa May, then there is a "war without rules" with Boris Johnson. This is because Johnson immediately took a "hard" position under the title "I don't care what the Parliament believes, I will do what I want." The prime minister has a lot of power, so the Parliament went to rest. But since the British MPs have been fighting for several years for the most "soft" Brexit, Johnson's plan was quickly realized. The Supreme Court ruled that the suspension of the work of deputies is illegal and canceled it. And now Boris Johnson, who couldn't agree with the European Union, couldn't agree with the Parliament, couldn't offer an alternative to the "backstop", does not want to postpone Brexit, will have three weeks to do at least something that will be regarded as a constructive action. But it's hard to say what it will be and whether there will be one at all. The fact remains: on October 17/18, at the EU summit, Johnson must either sign a "deal" with Brussels, either ask for Brexit postponement, or commit a direct violation of the law and withdraw the country from the EU without a "deal". At the moment, there is no construct with the first option, so the question is: is Johnson ready to put an end to his career, but to withdraw Britain from the European Union against the will of deputies? After all, such an option can then also be challenged and canceled in the courts. The reason is simple: the prime minister violated the law of the country whose head he is ...
The pound sterling feels that the clouds are gathering again and so the currency started to fall in price. In October, at least another interim decision on Brexit should be made. In principle, any option except the implementation of the hard Brexit on October 31 is positive for the British currency.
Trading recommendations:
On the 24-hour timeframe, the pound/dollar pair has started a correction against the upward trend, but if it overcomes the Kijun-sen line, then the downward movement will continue with the target of 1,2011 (near multi-year lows of the pair), which can be traded off by traders.
In addition to the technical picture, fundamental data and the time of their release should also be taken into account.
Explanation of the illustration:
Ichimoku indicator:
Tenkan-sen is the red line.
Kijun-sen is the blue line.
Senkou Span A - light brown dotted line.
Senkou Span B - light purple dashed line.
Chikou Span - green line.
Bollinger Bands Indicator:
3 yellow lines.
MACD indicator:
Red line and bar graph with white bars in the indicator window.
The material has been provided by InstaForex Company - www.instaforex.com