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GBP/USD: plan for the European session on May 7, 2019
To open long positions on GBP/USD you need:
Yesterday, buyers managed to show themselves in the support area of 1.3078, and today their main task for the first half of the day will be a consolidation above the resistance of 1.3130, which will break the upper limit of the downward channel that was formed and also provide GBP/USD with the momentum for a new upwards spurt to the highs of 1.3167 and 1.3227, where I recommend to take profits. In the event of a decline, the intermediate support will be the area of 1.3088, however, I recommend that you buy the pound immediately for a rebound only after the test of a low of 1.3038.
To open short positions on GBP/USD you need:
Today, bears will focus on the formation of a false breakdown in the resistance area of 1.3130, from which the lower boundary of the new downward channel is already built. However, the main task of the sellers will be a breakthrough and a return below the support level of 1.3088, which will push the GBP/USD pair to the area of lows of 1.3038 and 1.2992, where I recommend taking profits. If the growth scenario is above 1.3130, you can sell after updating the high of 1.3167, but it is best to wait for the test of level 1.3227 and open short positions from there immediately on the rebound.
Indicator signals:
Moving averages
Trade is conducted in the region of 30 and 50 moving averages, which indicates uncertainty about the British pound’s future direction.
Bollinger bands
In case of a decline, support will be provided by the lower boundary of the indicator near 1.3080. The breakthrough of the upper boundary around 1.3130 will be a signal for buying based on the continuation of an upward trend.
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
