our analysis of November 20.
The British pound is benefiting from optimism around Brexit. The news has reported that the deal is almost 100% and is basically imminent. However, fisheries, state aid and governance, remain points of disagreement.
Upon expectations of this deal in full, it could propel the pound to the 1.3590 level. However, if time passes without approval from Brussels, the British pound could suffer a very sharp decline to the 1.30 support level.
On the technical level, as you can see in 4-hour charts, it is above the 21-day EMA (pressure line) and above 5/8 of the murray line, the next resistance is at 6 / 8 murray level 1.3427.
It is also maintained above the EMA 200 located at 1.3061 as a strong medium-term support, eagle indicator is showing a downward divergence, and giving overbought signals.
Market sentiment for today November 23 shows a drop in short positions. Now there are 64% of investors who are selling, which could mean , that we could face a correction of GBP/USD in the coming days if the percentage decreases.
Our recommendation to buy on the bounce at 1.3280 and 1.3305, at this time there may be a pullback to gain more bullish momentum with targets at 1.3380 and 1.3427. in the short term.
On the other hand, a break of the EMA of 21 (pressure line) we could expect a retracement to 1.3183 and 1.3061.
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Trading tip for GBP/USD for November 23-24:
Sell if pullback to 1.3425 (6/8 murray) with take profit at 1.3305 and stop loss above 1.3460
Buy if the pair rebounds to 1.3305 and 1.3280 (5/8 murray) with take profit at 1.3380 and 1.3427, stop loss 1.3270
Sell with a convincing break below 1.3260 (break out bellow EMA21) with take profit at 1.3183 and stop loss above 1.3305.
