20.06.201909:45 Forex Analysis & Reviews: Trading recommendations for the GBPUSD currency pair - placement of trading orders (June 20)

For the last trading day, the currency pair pound / dollar showed high volatility of 130 points, as a result of having an impressive impulse. From the point of view of technical analysis, we see that the historical level of 1.2500 played the role of an excellent fulcrum, on the basis of which the current pulse course was drawn. Considering the graph in general terms, we see that the overall picture of the downward trend persists in the market and the current movement, associated to a greater degree with the information flow, temporarily changed the balance of trading forces, but the clock frequency "Impulse --- Correction" persists in the market.

For the past day, the information and news background had data on inflation in the United Kingdom, where, as expected, we saw a slowdown from 2.1% to 2.0%. The key event was the meeting of the Federal Commission on Open Market Operations, where, naturally, the key rate was left at the same level of 2.5%, but everyone was interested in the outcome and the FOMC rhetoric regarding the future actions of the regulator. At a subsequent press conference, it was said that the growing economic uncertainty and lower expected inflation made the Fed make it clear that they could lower the base rate this year. The reduction may amount to a total of 0.5%, that is, two reductions by the end of the year: 0.25 + 0.25.

Although this news was in some respects expected, the market reacted strongly to it. The American currency flew on all fronts, and, probably, at this moment, US President Donald Trump was smiling somewhere on the sidelines.

By tradition, we are completing the informational and news background with our favorite circus tent from the UK, where the third round of elections for the post of head of the British conservatives and the prime minister of the country ended. Who do you think won? That's right, no need to think - Boris Johnson. This time he got 143 votes from members of the House of Commons, which is 17 more than in the second round. The closest rival is the acting foreign minister Jeremy Hunt scored 54 votes. Voting will continue this week and will continue until there are two candidates left. The fourth and fifth rounds of voting are scheduled for Thursday. Although, I think you know the winner for a long time.

Today, in terms of the economic calendar, we have data on retail sales in Britain, where a significant decline is expected from 5.2% to 2.7%, which clearly could damage the British currency. At the same time, the meeting of the Bank of England with a subsequent press conference will be held today, but one should not expect anything from it until Brexit takes place.

Further development

Analyzing the current trading chart, we see that the quote has flown down to the level of 1.2708, that is, the border of the previously completed flat. It is likely to assume that at local overheating, we can expect a temporary stagnation followed by the resumption of short positions, and in this we can contribute to the negative statistics for Britain.

Based on the available information, it is possible to decompose a number of variations, let's consider them:

- I wouldn't have considered the purchase positions, as those who wanted to fly into the impulse, has already entered and left at the time of the announcement of the FOMC maneuvers. If you still hold the position, you can try to reach the level of 1.2740-1.2760 with the rest of the trading volume, but do not forget about local overheating.

- Positions for sale are considered in the recovery process plan, where you can analyze the point 1.2670 as a time to enter.

Indicator Analysis

Analyzing a different sector of timeframes (TF), we see that indicators in the short and intraday perspective are configured in an upward plan due to a recent surge. The medium term is still prone to downturn.

Weekly volatility / Measurement of volatility: Month; Quarter; Year

Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.

(June 20 was based on the time of publication of the article)

The current time volatility is 74 points, which is a high value for the current time span. This increase in volatility is reflected in our recent FOMC meeting, and it is likely to assume that the amplitude will gradually shrink.

Key levels

Zones of resistance: 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