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GBP/USD: plan for the European session on August 6, 2019
To open long positions on GBP/USD you need:
Yesterday’s PMI data for the service sector was not enough, however, pound buyers are ready to break through resistance at 1.2167, and have prepared a good technical formation from August 1 for this. Only under such conditions will a large upward correction be formed, which will open up a real opportunity to update a high of 1.2240 and test a larger level of 1.2300, where I recommend taking profits. If pressure on the pound returns when negative Brexit news appears, then keeping the level of 1.2083 in the first half of the day and forming a false breakdown there will allow us to expect a repeated upward correction to the resistance area of 1.1267. In the scenario of a further fall in GBP/USD, it is best to look at long positions from lows of 1.2040 and 1.1985.
To open short positions on GBP/USD you need:
Bears are trying by all means to keep the pair below the resistance of 1.2067, which so far keeps the market on the side of sellers who are counting on the next negative Brexit news, which will again return GBP/USD to the support area 1.2083, a break through which will strengthen the bearish trend and lead to updating lows of 1.2083 and 1.2040, where I recommend taking profits. If once again bulls attempt to raise the pair today in the morning, the formation of a false breakdown in the resistance area of 1.2167 will be another signal to open short positions. If the pound grows above the level of 1.2167, it is best to sell GBP/USD from a high of 1.2240, which was formed at the beginning of last week, or to rebound from the larger resistance of 1.2300, as the bullish correction can have a very strong impulse.
Signals of indicators:
Moving averages
Trade in the region of 30 and 50 moving averages, indicating short-term market uncertainty.
Bollinger bands
Volatility is very low, which does not provide signals on entering the market.
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
