To open long positions on GBP/USD is required:
There is no news on Brexit, and the growth of the pound is based only on the weakness of the US dollar. Today, it is best to return to long positions after forming a false breakout in the area of 1.2649 or a rebound from the support of 1.2609. The main task for the first half of the day will be a breakthrough and consolidation above the resistance of 1.2696, but much will depend on what data will be released today on inflation in the UK. A good report can lead to the growth of GBP/USD in the area of highs 1.2740 and 1.2787, where I recommend to take profit.
To open short positions on GBP/USD is required:
Sellers need a false breakout in the resistance area of 1.2696, which will be the first signal to short positions on the pound with an exit under the support level of 1.2649. Only a consolidation below this range will allow us to count on the resumption of the downward movement in GBP/USD with the exit to the lows in the area of 1.2609 and 1.2566, where I recommend to take profit. In case of continued growth of the GBP/USD after the release of a good inflation report, it is best to open short positions on the rebound from the new highs in the area of 1.2740 and 1.2787.
Indicator signals:
Moving averages
Trade is conducted just above the 30-day and 50-day moving average, with a short-term advantage of buyers of the British pound.
Bollinger bands
The downward correction in the pair will be limited to the lower limit of the Bollinger Bands indicator around 1.2615, a breakthrough of which will lead to a large sell-off of the pound. The upper limit of the indicator around 1.2690 limits the upward correction in the pound.
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
