To open long positions on GBP/USD you need:
Buyers yesterday managed to regain the resistance 1.1798, thanks to purchases from support 1.1635, from which I advised you to open long positions immediately on the rebound. This is clearly visible on the 5-minute chart. At the moment, their task in the first half of the day will be to defend, now support 1.1798, and the formation of a false breakout there will lead to a repeated wave of GBP/USD growth in the area of highs 1.1926 and 1.2023, where I recommend taking profits. The resistance update of 1.2023 will also lead to a test of the upper boundary of the upward channel, which will allow us to maintain a bullish trend in the pair. However, it is not worth counting on a protracted upward scenario. Today, the Bank of England will publish a decision on interest rates and possibly announce new measures to help the economy, which could put pressure on the British pound. In case the pair falls to the 1.1798 level, it is best to open new long positions when the pound returns to support 1.1635, as it was yesterday, or buy immediately to rebound from the year’s low of 1.1470.
To open short positions on GBP/USD you need:
Bears need to concentrate on regaining 1.1798 support, as only this will raise the pressure on the pair and lead to a fall to the low of 1.1635, where buyers actively announced themselves yesterday. However, it will be more bold to talk about the resumption of the bearish trend only after a breakout of this range, which will lead to the demolition of a number of stop orders of buyers and a more rapid decrease in GBP/USD to the low of 1.1470, where I recommend taking profits. The bears will also focus on the formation of a false breakdown in the resistance area of 1.1926, which will be a clear signal for opening short positions expecting that the pair will resume to fall along the trend that has been formed since the beginning of March. With the GBP/USD growth scenario above resistance 1.1926, it is best to return to short positions on the test of a high of 1.2023, where the upper boundary of the ascending channel passes, or sell immediately for a rebound from a larger resistance 1.2112, counting on a correction of 60-70 points inside of the day.
Signals of indicators:
Trading is slightly above 30 and 50 moving averages, but so far buyers of the pound cannot get a special advantage in the market.
A break of the upper boundary of the indicator at 1.1935 will cause the pound to grow further, and a break of the lower boundary at 1.1720 will raise the likelihood of a resumption of the bearish trend.
Description of indicators
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
- MACD indicator (Moving Average Convergence / Divergence – moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
- Bollinger Bands (Bollinger Bands). Period 20
The material has been provided by InstaForex Company – www.instaforex.com