To open long positions on GBP/USD, you need:
Excellent purchases from a low of 1.2408 on Friday, which I noticed in my review, led to a repeated update of resistance of 1.2512, which will be emphasized in the first half of the day. At the moment, the task of buyers of the British pound is to keep the 1.2462 level, and forming a false breakout on it will be an excellent signal to open new long positions in the hope of continuing the upward correction to the high of 1.2512. Its breakout will lead to a larger upward trend in the area of 1.2573 and 1.2632, where I recommend taking profits. If the demand for the pound does not return after the correction to the support of 1.2462, then by analogy with Friday, it is best to return to long positions only after the test of the low of 1.2408. Given that no important fundamental data on the UK economy is released today, buyers of the pound may try to take the market under their control.
To open short positions on GBP/USD, you need:
Sellers of the pound did not allow the pair to go above the resistance of 1.2512, which was quite expected. At the moment, the bears in the first half of the day will expect a breakout and consolidation below the 1.2462 level, which is a kind of middle of the side channel and where the pair is currently located. A break of this level will be a signal to open short positions in order to fall to the low of 1.2408 and with a possible support test of 1.2358, where I recommend taking profits. If the bulls are stronger and manage to remain optimistic after the good news about the fight against COVID-19, we are talking about successful tests of the vaccine, then it is best to return to short positions immediately on the rebound from the major resistance of 1.2573, where a large surge in volume will be recorded, indicating the exit of speculative buyers from the market.
Signals of indicators:
Moving averages
Trading is conducted in the region of 30 and 50 moving average, which indicates a clear attempt by the bulls to seize the initiative.
Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differs from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger bands
A break of the upper border of the indicator at 1.2525 may lead to a new wave of growth for the pound. In the event of a decline, you can buy on the test of the lower border of the indicator in the 1.2435 area.
Description of indicators
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
- MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
- Bollinger Bands (Bollinger Bands). Period 20
