Senior linear regression channel: direction – down.
Minor channel of linear regression: the direction is up.
Moving average (20; smoothed) – sideways.
The GBP/USD currency pair on Monday, July 16, adjusted to the moving average line and it is clear that it can not develop an upward movement. The prospects for the pound remain vague due to the resignation of Johnson and Davis, the weakening positions of Theresa May, as well as due to all the uncertainties about Brexit. On Monday, there will be a speech by the head of the Bank of England Mark Carney, who may well touch on the topic of the political crisis in the UK. In any case, his comments on what is happening in the British Parliament, as well as his expectations regarding the new “soft” Brexit plan and its consequences for the economy will cause interest among traders. On the other hand, what can Carney say? It is unlikely that he will crumble in compliments to Theresa May and express confidence in a bright future. It is clear and understandable to all that Brexit’s entire procedure, although it’s going according to plan, is too prolonged and has too much controversy. And it still began with a referendum in which supporters of the withdrawal from the EU won with a minimum margin, which means that at least 48% of British citizens against Brexit and will be dissatisfied with any of its scenario. In general, all the victories of the pound looks like local at the moment.
Nearest support levels:
S1 – 1,3184
S2 – 1,3123
S3 – 1,3062
Nearest resistance levels:
R1 – 1,3245
R2 – 1,3306
R3 – 1,3367
For the GBP/USD pair, the price broke above the moving average and started a correction. Thus, on July 17, it is recommended to wait until after a correction (reversal of the Heiken-ASHI to the top) and open long positions with the target of 1,3306.
Sell orders will become relevant only after traders are secured back below the moving average with a target of 1.3184. In this case, the initiative on the instrument will go back to the bears.
In addition to the technical picture, one should also take into account the fundamental data and the time of their release.
Explanations for illustrations:
The upper channel of linear regression is the blue lines of unidirectional motion.
The lower channel is linear-violet lines of unidirectional motion.
CCI – the blue line in the regression window of the indicator.
Moving average (20; smoothed) – the blue line on the price chart.
Murrey levels are multi-colored horizontal stripes.
Heiken Ashi is an indicator that color bars in blue or purple.The material has been provided by InstaForex Company – www.instaforex.com