EUR/USD – 4H.
As seen on the 4-hour chart, the EUR/USD pair is trading between the correction levels of 100.0% (1.1107) and 76.4% (1.1180) on the eve of the Fed meeting, which will begin today, and its results will be known tomorrow. Despite the fact that the US regulator is preparing to lower the key rate for the first time in many years, all the attention of traders is focused on the UK, Brexit and Boris Johnson. The main question for traders before July 31, how much will the Fed reduce the rate? Donald Trump, who does not tire of criticizing the Fed and its Chairman Jerome Powell for the fact that the system is inactive, for the fact that high rates hinder the development of the economy, for the fact that high rates lead to the growth of the dollar, for the fact that the ECB and the Bank of China support their economies by injecting new money supply, by reducing the euro and the yuan, and the Fed does nothing, criticized the Fed again. This time, when the probability of reducing the key rate is quite high, and it would seem that the Fed will satisfy the desire of the US President, this is not enough for Trump. He believes that the rate should be reduced by 50 basis points, not by 25. Reduction by 50 basis points. It will, of course, be a surprise for traders, and in this case, it will be possible to count on a serious fall in the dollar. But the Fed is unlikely to take that step. Powell has repeatedly shown his independence from Trump, so it is unlikely to meet him halfway.
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.
As seen on the 4-hour chart, the GBP/USD pair performed a consolidation under the correction level of 127.2% (1.2180) and continues the process of falling in the direction of the next correction level of 161.8% (1.1853). The most interesting thing is that no super important information from the UK has been received in recent days. Yes, Boris Johnson began active preparation for a tough Brexit, created a "military" committee, announced 100 million spendings on informing the population, but nothing that would force traders to conclude about the inevitability of such a scenario. The UK Parliament can easily block hard Brexit on voting, and what then? However, most traders believed in recent days that Johnson will be able to withdraw the country from the Alliance on time, October 31. And the only real option for the completion of Brexit is a tough scenario, a scenario without agreements with the EU. That is why the pound sterling falls again and falls strongly, as absolutely everyone understands that Brexit without agreements is the strongest blow to the UK economy, which will recover from this blow for many years.
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 also continues to fall in the direction of the correction level of 261.8% (1.2057). Today, the divergence is not observed in any indicator. The rebound of quotations from the Fibo level of 261.8% will allow traders to expect a reversal in favor of the English currency and some growth in the direction of the correction level of 200.0% (1.2227).
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 1.2057, with the stop-loss order above the level of 1.2227. I recommend buying the pair with the target of 1.2227 and stop-loss order under the level of 261.8% (hourly chart) if it will be rebounded from the level of 1.2057.
