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Forecast for EUR/USD and GBP/USD on August 12, 2019
EUR/USD – 4H.
As seen on the 4-hour chart, the EUR/USD pair continues to trade between the correction levels of 61.8% (1.1224) and 76.4% (1.1180), alternately performing rebounds from each level. At the moment, the euro/dollar pair is growing in the direction of the Fibo level of 61.8%. Today, the divergence is not observed in any indicator. Since no economic reports were released on Friday, and the Monday news calendar is empty, the sideways trend can be maintained today. Traders of the currency market can safely stay inside the side channel indicated above, waiting for news. Unfortunately, in the last two or three weeks, the main drivers of the pair’s movement were the Fed and ECB meetings and the expectations of the results of these meetings. Now, when there is still plenty of time before the next meeting of regulators and the market clearly understood that both organizations are set to mitigate monetary policy, there is a balance that can only be pulled out when new interesting news is received. Technically, to determine the readiness of traders in more active actions than now, it will be possible to close the quotes above the Fibo level of 61.8% or under 76.4%.
The Fibo grid is built on the extremes of May 23, 2019, and June 25, 2019.
Forecast for EUR/USD and trading recommendations:
The EUR/USD pair performed the rebound from the correction level of 76.4% (1.1180). I recommend buying the euro/dollar pair with a target of 1.1260, with the stop-loss order below the level of 1.1224, if the closing is performed above the level of 61.8%. I recommend selling the pair with the target of 1.1180, and with the stop-loss order above the level of 1.1224, if the rebound from the correction level of 61.8% is executed.
GBP/USD – 4H.
Several rebounds of the pair from the correction level of 127.2% (1.2180) worked in favor of the US currency, as a result of which the fall of the GBP/USD pair resumed in the direction of the Fibo level of 161.8% (1.1853). Today, August 12, a bullish divergence is brewing in the MACD indicator, which allows us to count on a reversal in favor of the English currency and the return of the pound/dollar pair to the correctional level of 127.2%. Today, we decided to focus on summarizing the results of the first three weeks of Boris Johnson’s reign. First, the British pound fell by 4.5 cents against the US dollar. Secondly, it was not possible to resume negotiations with Brussels on Brexit terms. Thirdly, the preparation of the hard Brexit, an alternative to which is not visible now. Fourthly, the Parliament is opposed by all means to ensure that Johnson does not implement Brexit on his own and will confront the generally tough Brexit. Fifth, the opponents of hard Brexit, and hence the policy of Boris Johnson has become much more. Sixth, a political conspiracy is brewing against Johnson due to the prime minister furiously promoting Brexit “No Deal”. Seventh, the Laborites began to openly oppose Johnson. Eighth, according to insider information, Queen Elizabeth II of Great Britain is dissatisfied with the government, which for the past three years has been unable to withdraw the country from the EU. As a conclusion: in the first three weeks of Boris Johnson’s work, it is difficult to find any positive moment for the UK. Accordingly, the fall of the pound sterling will continue, and Boris Johnson himself will openly fight with opponents of Brexit “No Deal” in Parliament.
The Fibo grid is built on the extremes of January 3, 2019, and March 13, 2019.
GBP/USD – 1H.
As seen on the hourly chart, the pound/dollar pair performed a consolidation below the Fibo level of 261.8% (1.2057). Thus, the fall of quotations can be continued in the direction of the next correction level of 323.6% (1.1883). The closing of the pair above the Fibo level of 261.8% can be interpreted as a reversal in favor of the English currency and expect some growth in the direction of the correction level of 200.0% (1.2227).
The Fibo grid is based on the extremes of June 18, 2019, and June 25, 2019.
Forecast for GBP/USD and trading recommendations:
The GBP/USD pair continues the process of falling. Thus, I recommend selling the pair with the target of 1.1883, with the stop-loss order above the level of 261.8%. I recommend buying the pair with the target of 1.2227 and with the stop-loss order below the level of 261.8%(hourly chart) if the closing is performed above the level of 1.2057.
The material has been provided by InstaForex Company – www.instaforex.com
