GBP/USD: plan for the European session on December 5. The likely resignation of Theresa May puts pressure on the pound

To open long positions on GBP/USD it is required:

Another sharp increase in the pound after the decision of the European Court of Justice was replaced by a more rapid decline, which led to the renewal of the monthly lows. At the moment, it is best to expect to buy the pound after updating the low of yesterday with the formation of a false breakout at 1.2666, which will lead to an upward correction in the area of 1.2709. Consolidation at this level will open the prospect of growth in the resistance area of 1.2759, where I recommend to lock in the profit. Most of the day will depend on PMI data in the service sector. In case the pound further declines under the support of 1.2666, it is best to consider long positions on the rebound from the lows of 1.2625 and 1.2569.

To open short positions on GBP/USD it is required:

An unsuccessful consolidation above the resistance of 1.2709 will be another signal to sell the GBP/USD in order to break and consolidate below the support of 1.2666, which will lead to a larger decrease in the pound in the area of the low of 1.2625 and 1.2569, where I recommend taking profit. However, the movement in the morning will be based on PMI data, so I advise that you pay attention to them. In case of growth above 1.2709, short positions can be returned to the rebound from the resistance of 1.2759.

Indicator signals:

Moving averages

The trade moved below the 30-day and 50-day moving averages, which indicates further formation of a bearish market.

Bollinger Bands

In the event of a decline in the pound, the support will be provided by the lower limit of the indicator in the area of 1.2660, while the growth may be limited by the middle of the Bollinger Bands channel in the area of 1.2730.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
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