17.02.202113:37 Forex Analysis & Reviews: Analysis and forecast for GBP/USD on February 17, 2021

Daily

After overcoming the strong technical level of 1.3865, which acted as a resistance, the British pound intended to continue its strengthening against the US dollar, however, it was not so easy to do this. This is not the first time that we have to note the strength and significance of the technical zone near 1.3960. This time, yesterday's attempts of the British currency to continue its growth against the US dollar were limited to 1.3950. At the same time, a classic doji candle has formed on the daily chart, which has no body, and there are approximately two equidistant shadows - the upper and lower, respectively. Although if you look more closely, the upper shadow is still slightly larger, which may indicate a weaker position of the players on the rise of the British currency.

It should be noted that today, the pound/dollar currency pair will be saturated with important fundamental data, which will undoubtedly have a significant impact on the price dynamics of GBP/USD. Reports from the UK on retail and consumer prices have already been released. And here's the paradox. Even though the British statistics exceeded the forecast values, this did not provide sterling with the expected support. Moreover, at the time of writing this article, the pound/dollar pair is trading near 1.3877. Starting at 14:30 London time, important statistics will begin to arrive from the United States of America, and the publication of the minutes of the last meeting of the US Federal Reserve Open Market Committee will complete the fundamental block of today at 20:00 (London time). Thus, we can assume that the main events are still ahead.

From a technical point of view, it is simply necessary for the pound bulls to absorb the growth of yesterday's doji candle. But their opponents need to lower the rate below 1.3865 and close trading below. In this case, the level of 1.3865 will be considered falsely broken, which will create good prerequisites for the continuation of the downward scenario for GBP/USD. At the very least, yesterday's daily doji candle is likely to be perceived by market participants as a reversal signal for a decline. Perhaps this explains the strange reaction to the good British statistics.

H4

On the four-hour chart, the bears' attempts to return the pair below the mark of 1.3865 are visible. In case of successful completion of its task, the quote can fall into the price zone of 1.3820-1.3780, where the 89 exponential and 50 simple moving averages pass. It is quite reasonable to assume that in the designated area, the pair will find strong enough support to at least make a good rebound up, or even turn in the north direction. However, everything is the will of the market, as well as the upcoming and quite important macroeconomic statistics from the United States, which will be crowned by the FOMC protocols.

Today, given the upcoming events from the US, it is difficult to give any specific trade recommendations. Most likely, the volatility will go through the roof, and therefore those who want to buy the British currency should do it from the depths, at lower prices. As an option, I recommend paying attention to the already designated price zone of 1.3820-1.3780, below you can look at the purchases of GBP/USD after a short-term decline in the area of 1.3700-1.3685. I recommend that you refrain from selling right here and now. Let's see how today's trading will end, and tomorrow, taking into account the current situation, we will consider options for opening short positions.