Overview of the GBP/USD pair. April 27. The UK failed to prepare for the "coronavirus" epidemic. Responsibility is placed

4-hour timeframe

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Technical details:

Higher linear regression channel: direction - downward.

Lower linear regression channel: direction - upward.

Moving average (20; smoothed) - downward.

CCI: 8.1909

On April 27, the British pound continues to adjust to the moving average line, from which it previously rebounded. Thus, the downward movement has not been resumed yet, and the Heiken Ashi indicator continues to color the bars purple. Thus, we are waiting for either a rebound from the moving average or its overcoming, which will determine the fate of the pair for the next few days. On the first trading day of the week, no important macroeconomic publications are planned in the UK and the United States. Therefore, the fundamental background will again be represented by unplanned speeches and comments from top officials. This is especially true for Donald Trump, who "goes on the air" almost every day, and his Twitter account is updated every few hours.

Meanwhile, the situation with the COVID-2019 virus is improving only on paper. In practice, almost 3 million cases of the disease and more than 200 thousand deaths from the pandemic have been recorded in the world. The US is still the leader in the number of infections but the UK is not losing the growth rate of the epidemic. In the Foggy Albion, 154,000 cases of the disease have already been recorded, so in the next few days, Britain can overtake Germany and reach the fifth place in the world in terms of the number of patients. Also, the UK has a fairly high death rate - much more than 10%, while scientists around the world conclude that the average death rate should not exceed 3-5%. And in many countries like Germany, it really does not exceed 3-5%. But in the UK, things are much worse. Health officials believe that the country's government completely failed to prepare for the epidemic and for a long time refused to take into account the full danger of the virus. That is why in the coming weeks, it is Britain that can become a hotbed in Europe. The blame for what is happening is laid personally on Boris Johnson, who himself has only recently recovered from the virus and will take up his duties as Prime Minister today. Some British publications have even conducted entire investigations to find out why there is such a large number of infected people in Britain and such a high mortality rate (which, we will remind, also does not take into account deaths outside medical institutions). The journalists concluded that, first of all, the country was not prepared for an epidemic of this kind. No preparations for a possible epidemic have been made for many years, and the stocks of personal protective equipment have not been replenished, updated, and in the end, many of them have expired. Secondly, the government of Boris Johnson for a long time refused to take seriously the signals of virologists about the severity of the disease and its highest level of transmission. Thus, according to experts, the country lost about five weeks at the very beginning.

Boris Johnson is personally charged with a lack of leadership qualities in difficult times for the country. It is reported that at the beginning of the year, he was not present at any meeting of "Cobra". "COBRA" - "Cabinet Office Briefing Room A" - "Room A of the Cabinet of Ministers". This is an emergency government committee that meets only in emergencies. So the Prime Minister did not attend any meetings of the emergency committee, transferring his responsibilities to Matt Hancock, the Minister of Health. Johnson was defended by Michael Gove, who said that the presence of the Prime Minister is not necessary at such meetings.

At the same time, according to the investigation, the British authorities were unable to reach an agreement with the British trade health association, which is represented by 500 manufacturers. According to the association, the companies were ready to produce and supply the UK health sector with the necessary amount of personal protective equipment and all the necessary tools to fight the epidemic, but applications for delivery began to be considered only on April 1. Therefore, British manufacturers supplied protection products to other countries. Sources close to the Prime Minister also report that Boris Johnson did not attend any emergency meetings, spent a lot of time at his country residence, and did not work at all on weekends. Later, the authorities admitted that 20,000 "deaths" from the epidemic would not be considered a bad result. And British doctors believe that Britain will come out of the fight against the epidemic with one of the worst results in the world.

The investigation also cites the example of many other countries where the COVID-2019 virus was taken seriously from the very beginning. For example, in Taiwan, almost from the very beginning, they began testing and tracking all potentially infected people. As a result, as of mid-April, less than fifty infections were recorded in the country. South Korea is an example of how you can resist a pandemic without even imposing a quarantine. The country's authorities also immediately began conducting mass testing and tracking contacts of people who became ill, which led to a sharp reduction in the number of cases and the pandemic was brought under control in record time. And the UK, along with Italy, France, and Spain, which also "failed" the beginning of the pandemic and preparation for it, are now reaping the fruits of their mistakes.

Thus, in general, the conclusions for Britain are not comforting. We assumed last year that Boris Johnson is not the best candidate for the post of head of the country. Now it is his government that has failed to prepare for and confront the epidemic. Brexit threatens to be "hard", which negates all the efforts of the British Parliament for three years, which blocked the Prime Ministers' attempts to withdraw the country from the European Union without a clear agreement. But Johnson has found a way to circumvent parliamentary blockages and now refuses to extend the "transition period", and the negotiations, despite video conferences by Michel Barnier and David Frost, can be considered put on pause. Thus, the British economy can already suffer more than the rest, and given the situation with Brexit, it can generally have a very hard time. Well, let's see if the British people were right when they voted for Johnson's party on December 13, 2019 on the principle of "just to finish Brexit faster".

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The average volatility of the GBP/USD pair has stopped decreasing and is currently 116 points. In the last 20 trading days, the pair almost every day passes from 100 to 200 points. Therefore, we can say that volatility is now stable. On Monday, April 27, we expect movement within the channel, limited by the levels of 1.2248 and 1.2480. A downward turn of the Heiken Ashi indicator will indicate the end of the upward correction within the downward trend.

Nearest support levels:

S1 - 1.2329

S2 - 1.2268

S3 - 1.2207

Nearest resistance levels:

R1 - 1.2390

R2 - 1.2451

R3 - 1.2512

Trading recommendations:

The GBP/USD pair started to adjust on the 4-hour timeframe. Thus, traders are advised to consider selling the pound on Monday with targets of 1.2268 and 1.2248, after the reversal of the Heiken Ashi indicator down. It is recommended to consider purchases of the British currency not before fixing traders above the moving average with the first goal of the Murray level of "4/8"-1.2451.

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