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For the last trading day, the currency pair pound / dollar showed a low volatility of 59 points again, as a result of forming a low amplitude within the pivot point. From the point of view of technical analysis, we see that the quote has come up to the level of 1.2620, forming a narrow amplitude of 1.2600 / 1.2620, which we talked about in the previous review. Looking at the graph in general terms, we see that the "Impulse" tact is still on the market and only the 1.2600 / 1.2620 range stands before us. If we step back a bit from the bars, then we see that during the whole trading week, we saw an extremely low volatility, although there was some purposeful movement. The reason is fear and uncertainty caused by the "divorce" process of Brexit. Although investors try to stand aside, but they clearly understand that the business of Britain may be in great danger. On the other hand, the news background had statistics on the United States, where they published the second estimate of GDP for the first quarter, and, as expected, there was a slowdown in economic growth to 3.1%. At the same time, data on applications for unemployment benefits will be published in the United States, where they waited for a reduction of applications by 10 thousand, and as a result, they received only 22 thousand, which, by the way, supported the dollar. On the information background, in general, everything is the same, floundering in Brexit, but without abrupt actions. Thus, we are waiting for the new prime minister, and there will be an action.
Today, in terms of the economic calendar, we have data on the lending market in the UK, where the volume of consumer lending is growing from 0.549B to 0.978B in comparison with the previous months of calculation. Approved applications for mortgage also show growth from 62341 to 63250. In general, the news is positive for the pound, but not the fact that it will help it. In the afternoon, there will be data on personal expenses and income in the United States, where growth is also expected.
The upcoming trading week in terms of the economic calendar is extremely saturated with statistics and events. If we select only events, then we have: the speech of the Fed Chairman, Mr. Powell; voting in the UK Parliament; Theresa May's resignation and possible receiver. Are you already looking forward to good volatility? The most interesting events displayed below --->
Monday, June 3
United Kingdom 8:30 Universal time - Manufacturing Business Index (PMI) (May): Prev. 53.1 ---> Forecast 53.0
United States 14:00 UTC+00 - Manufacturing PMI from ISM (May): Prev. 52.8 ---> Forecast 53.3
Tuesday, June 4
United Kingdom 8:30 Universal time - Business activity index in the construction sector (May): Prev. 50.5
United States 13:45 UTC+00 - Speech by Fed Chairman Mr. Powell
Voting in the Parliament of Great Britain under the Brexit Agreement
Wednesday, June 5
United Kingdom 8:30 Universal time - Business Services Index (May): Prev. 50.4 ---> Forecast 50.5
United States 12:15 UTC+00 - Change in the number of people employed in the non-farm sector from ADP (May): Prev. 275K ---> 190K forecast
United States 14:00 UTC+00 - Non-manufacturing Business PMI (PMI) from ISM (May): Prev. 55.5 ---> Forecast 56.0
Friday, June 7
United States 12:30 UTC+00 - Change in the number of people employed in the non-agricultural sector (May): Prev. 263K
---> 190K forecast
United States 12:30 UTC+00. - Unemployment rate (May): Prev. 3.6% ---> Forecast 3.7%
Theresa May's Resignation
These are preliminary and subject to change.
Further development
Analyzing the current trading schedule, we see bumpiness in the range of 1.2600-1.2620, which reflects a certain indecision, and at the same time, a possible regrouping of trading forces. It is possible to assume that the oscillation amplitude will slightly increase 1.2600 / 1.2640, but then we are working on breaking the boundaries, monitoring the price fixing points.
Based on the available information, it is possible to decompose a number of variations. Let's consider them:
- We consider buy positions in case of price fixing higher than 1.2640, with the primary prospect of a move to 1.2680.
- We consider selling positions in the case of a clear price fixing lower than 1.2570, with the prospect of a move to 1.2500-1.2430.
Indicator Analysis
Analyzing a different sector of timeframes (TF), we see that indicators in the short term have changed from a downward to an upward one, due to the current stagnation. Meanwhile, intraday and mid-term perspective preserves downward interest against the general background of the market.
Weekly volatility / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.
(May 31 was based on the time of publication of the article)
The current time volatility is 21 points. Volatility will remain low if the quotation continues sluggish fluctuation within 1.2620. The only breakthrough may be in the event of a fracture of the current stagnation.
Key levels
Zones of resistance: 1.2620; 1.2770 **; 1.2880 (1.2865-1.2880) *; 1.2920 * 1.3000 **; 1.3180 *; 1,3300 **; 1.3440; 1.3580 *; 1.3700.
Support areas: 1.2620; 1,2500 *; 1.2350 **.
* Periodic level
** Range Level
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