EUR/USD – 4H.
As seen on the 4-hour chart, the EUR/USD pair returned to the correction level of 100.0% (1.1107). The latest news last week – US GDP for the second quarter – showed that not everything is so bad in the US. This is unlikely to save the country from lowering the key rate, as the Fed should announce on July 31, but the US dollar is still in demand thanks to these reports. Of course, last week, Mario Draghi and the European Central Bank created pressure on the euro. Thus, in general, we have a bias in the number of negative factors towards Europe. That is why the dollar continues to grow, and the euro currency cannot find the "bottom" of the downward trend. It follows that the hopes of the euro/dollar pair bulls are reduced to the fact that the Fed can lower the key rate by 0.5% at once or take a whole cycle of rate cuts. Roughly speaking, for the euro to start growing, it is necessary that the economic situation in America becomes worse than in the eurozone. In the near future, this is not expected, so traders can count on the consolidation of quotations under the Fibo level of 100.0% (1.1107), which will allow us to expect the continuation of the fall in the direction of the next correction level of 127.2% (1.1025). The rebound of the pair from the Fibo level of 100.0% will allow counting on some growth of the euro in the direction of the correction level of 76.4% (1.1180).
The Fibo grid is built on the extremes of May 23, 2019, and June 25, 2019.
Forecast for EUR/USD and trading recommendations:
The EUR/USD pair performed a fall towards the correction level of 100.0% (1.1107). I recommend selling the pair today with the target of 1.1025, with the stop-loss order above the level of 1.1107, if the closing is performed under the level of 100.0%. I recommend buying the pair with the target of 1.1180 and stop-loss order under the level of 1.1107 if it will be rebounded from a correction level of 100.0%.
GBP/USD – 4H.
The GBP/USD pair performed a consolidation under the correction level of 100.0% (1.2437) and continues the process of falling in the direction of the next correction level of 127.2% (1.2180). The latest news from the UK suggests that the government seems to have realized that the EU will not re-discuss the terms of Brexit and will not yield on the issue of the border between Ireland and Northern Ireland. Thus, Boris Johnson has already formed the so-called "military cabinet", which consists of 6 Ministers, ardent supporters of the rigid Brexit scenario. It is in coordination with these 6 ministers that Johnson will make all decisions regarding Brexit. Great Britain is taking small steps towards the exit from the EU on October 31, but there is one stumbling block, namely the Parliament. As you know, very few deputies support a tough scenario, as they believe that it will cause huge damage to the economy and GDP, which will then be restored for many years. And it is unlikely they will vote "for" this way out of the EU. Thus, Prime Minister Johnson can take any action regarding the possible scenario, but there will be no Brexit at all if Parliament does not approve it. There will be a new date transfer.
The Fibo grid is built on the extremes of January 3, 2019, and March 13, 2019.
GBP/USD – 1H.
As seen on the hourly chart, the pound/dollar pair continues to fall in the direction of the correction level of 161.8% (1.2334). Today, the divergence is not observed in any indicator. The rebound from the Fibo level of 161.8% will allow us to expect a reversal in favor of the pound and some growth in the direction of the correction level of 127.2% (1.2430).
The Fibo grid is based on the extremes of June 18, 2019, and June 25, 2019.
Forecast for GBP/USD and trading recommendations:
The GBP/USD pair continues the process of falling. Thus, I recommend selling the pair with a target of 1.2334, with the stop-loss order above the level of 1.2430. I recommend buying the pair with the target of 1.2430 and stop-loss order below the level of 161.8% (hourly chart), if it will be rebounded from the level of 1.2334.
