GBP/USD: plan for the European session on January 8. The British pound is preparing to decline against the US dollar

To open long positions on GBP/USD you need:

While trading is above support at 1.2753, buyers of the British pound still have a chance to continue the upward trend, but this requires breaking and fixing above the resistance at 1.2798, which will open the way to new monthly highs around 1.2868 and 1.2929, where I recommend taking profits. In the event of a decline below the support level of 1.2753, it is best to consider long positions to rebound from the lows of 1.2708 and 1.2658.

To open short positions on GBP/USD you need:

The emerging divergence on the MACD indicator indicates the likelihood of the beginning of a downward correction in the pound, which already suggests itself for quite some time. An unsuccessful consolidation above 1.2798, or a breakthrough of support at 1.2753 will lead to a larger sale of GBP/USD with a test of lows around 1.2708 and 1.2658, where I recommend taking profits. Positive news on Brexit from the UK Parliament could lead to a sharp increase in the pound. In this scenario, short positions can be opened after the highs of 1.2868 and 1.2929 are updated.

Indicator signals:

Moving averages

Trade has moved to the area of 30-day and 50-day moving averages, which indicates the end of the upward trend in the pound.

Bollinger bands

A break of the lower border of the Bollinger Bands indicator in the area of 1.2753 may resume pressure on the pound.

kcXwGbMDyHUnwAAxj6YvllOyiLYlMWDZ3tEIik5e

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
The material has been provided by InstaForex Company - www.instaforex.com