GBP / USD. February 7th. The trading system. "Regression Channels". Theresa May will meet with Juncker and Tusk

4-hour timeframe

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Technical details:

The senior linear regression channel: direction - up.

The younger linear regression channel: direction - up.

Moving average (20; smoothed) - down.

CCI: -103.1988

The currency pair GBP / USD on Thursday, February 7, continues its downward movement and, most likely, will keep it all day. To date, the planned announcement of the results of the meeting of the Bank of England. This is certainly the most important event for the British pound, but we believe that there will not be a special market reaction to it. The rate is unlikely to change, the asset redemption program will retain its volumes, the balance of forces in voting at the rate is also likely to be unchanged (0 for changing the rate, 9 for against). Greater attention should be caused by the press conference of the head of the British regulator Mark Carney. However, everything can turn out to be quite prosaic. What can Carney say, besides the new portion of the concerns about the "tough" Brexit and the threat to the UK economy? This is clear and understandable to everyone. It is unlikely that new Carney fears will cause massive sales of the pound. Further. Today, there will also be a meeting between Theresa May and the head of the European Commission, Jean-Claude Juncker, and Donald Tusk. The discussion will be all the same mode "backstop." However, Juncker has already declared that Europe cannot give up the position of "backstop". Other EU leaders have repeatedly stated that the current transaction is the best option they can offer. The likelihood that Theresa May will return to London with nothing is very high. At the same time, the British Prime Minister is preparing to postpone the second vote on Brexit, since it is unlikely to have time before its date (February 13) to hold all the necessary meetings with EU leaders.

Nearest support levels:

S1 - 1.2939

S2 - 1.2909

S3 - 1.2878

Nearest resistance levels:

R1 - 1.2970

R2 - 1.3000

R3 - 1.3031

Trading recommendations:

The currency pair GBP / USD continues its downward movement, therefore, short positions with targets at 1.2909 and 1.2878 are still relevant. Color 1-2 bars in purple color will indicate the beginning of an upward correction.

Long positions are recommended to be considered in case of the reverse fixing of the price above the moving with targets at 1.3062 and 1.3092. A large package of important macroeconomic data today can support any currency, but, most likely, the decline will continue.

In addition to the technical picture should also take into account the fundamental data and the time of their release.

Explanations for illustrations:

The senior linear regression channel is the blue lines of the unidirectional movement.

The junior linear channel is the purple lines of the unidirectional movement.

CCI is the blue line in the indicator regression window.

The moving average (20; smoothed) is the blue line on the price chart.

Murray levels - multi-colored horizontal stripes.

Heikin Ashi is an indicator that colors bars in blue or purple.

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