4-hour timeframe
The amplitude of the last 5 days (high-low): 96p - 72p - 99p - 80p - 110p.
Average amplitude for the last 5 days: 91p (85p).
The British pound on Wednesday, December 26, began a downward correction against the weakest upward trend, which was formed on the instrument in recent days. We can not say that now there is a significant demand for the pound sterling. Rather, the US dollar in recent weeks is under pressure due to a change in the rhetoric of the Federal Reserve and the possible dismissal of Jerome Powell by Donald Trump. Although it is more rumors. There are no important macroeconomic reports in the calendar today, and traders have not received any important fundamental information. Thus, a fairly moderate and quiet movement of the pound is completely logical. What to expect from the pair in the final days of the year? We think it's nothing special. Most likely, not only until the end of 2018, but also until the date of the vote on Brexit in the British Parliament, the sideways trend will continue along the pair with a minimum slope up or down. This is explained by the fact that traders want to already understand what the UK will expect in the near future and what the final decision on Brexit will be, and how this epic will end in general. Until then, market participants do not want to risk in vain. So far, the pound is slightly adjusted, but it should be understood that it is not because of the demand for the British currency. Trading in this pair is associated with increased risks due to the lack of trend movement.
Trading recommendations:
The GBP/USD currency pair remains in the side channel with a slight upward bias. Long positions are now formally relevant, but after the correction, the minimum lots and the target of 1,2772.
Sell positions are recommended to consider no earlier than fixing the price below the level of 1.2591. In this case, the initiative will return to the hands of the bears, but the sluggishness and weakness of the movement, as well as the absence of a trend, will most likely remain.
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.
The material has been provided by InstaForex Company - www.instaforex.com