To open long positions on GBPUSD, you need:
In the first half of the day, I paid attention to the possibility of continuing the downward correction in the pair and the breakdown of support at 1.2185, which happened. If you look at the 5-minute chart, you will see how the bears easily achieved a breakdown of this support and gained a foothold under it. A repeated test of this level from the bottom up was a good signal to open short positions in the continuation of the bearish trend. However, at the time of writing, there was no serious movement down the pound, and each time the bears had problems around the low of 1.2162, which now acts as a kind of support at the moment. The task of the bulls for the second half of the day is to consolidate above the resistance of 1.2190, which may lead to a larger upward correction to the maximum area of 1.2245, where I recommend fixing the profits. A repeated decline to the minimum of 1.2162 will certainly lead to its breakdown, so it is best to look for new long positions after updating the larger level of 1.2122 in the expectation of correction of 30-35 points within the day.
To open short positions on GBPUSD, you need:
The task of sellers for the second half of the day is to hold the pair below the resistance of 1.2190. Although there is no strong hope for a downward movement of the pound from this level, as long as trading is conducted under this range, the bearish momentum will continue. A repeated test of the minimum of 1.2162 will probably lead to a larger sale of GBP/USD to the support area of 1.2122, and then to the test of the May minimum of 1.2074, where I recommend fixing the profits. In the scenario of a larger upward correction above the level of 1.2190, it is best to return to short positions on the pound today only for a rebound from yesterday’s high in the area of 1.2245.
Signals of indicators:
Trading is conducted below the 30 and 50 daily averages, which indicates the superiority of the pound sellers in the market.
Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
In the case of an upward correction, the area of 1.2245 will act as a resistance, from which you can open short positions immediately for a rebound.
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