4-hour timeframe
Technical data:
The upper channel of linear regression: direction – down.
The upper channel of linear regression: direction – up.
The moving average (20; smoothed) – down.
CCI: -182.9324
The GBP/USD currency pair continues to decline and is already trading near the lows of 2016, 2017 and 2019. Overcoming the level of 1.2000 will mean the road to the absolute lows of the pound against the US currency. The reasons for the new and regular fall of the pound are obvious. Traders do not particularly believe that the UK Parliament will be able to stop Boris Johnson and "hard" Brexit. Recall that parliamentarians have 6 days from today to pass a law on the impossibility of Brexit without an agreement with the European Union and/or a vote of no confidence in Boris Johnson. However, both initiatives do not guarantee the cancellation or postponement of Brexit on October 31. A vote of no confidence, even if supported by most deputies, is not an order to resign. It is only a desire of Parliament that Boris Johnson can easily ignore. The law, which assumes the impossibility of leaving the EU without a "deal", is almost guaranteed to lead to the dissolution of Parliament and re-elections. So, with a high probability, the current parliamentary composition is sitting out its last days in its seats. Parliamentarians, by the way, have a very interesting choice, especially the Conservatives. Those members of the Conservative Party who support the opposition on Brexit will be excluded from the Parliament. Boris Johnson has already warned about this. If most parliamentarians support the initiative of Jeremy Corbyn, Johnson will call for re-elections and, of course, the composition of Parliament will change. Most of the deputies will be re-elected, but some will lose their seats in Parliament. Thus, in the coming days, it is mathematics and probability theory that will come first. Everything will now depend on the courage of each deputy and his willingness to go against Johnson's "destructive" Brexit. If there is enough courage, then at least Brexit will be blocked on October 31 without agreement. This will give additional time for new wars with the Prime Minister. If courage is not enough, the probability of "hard" Brexit will be 100%. And do not forget that today, there will be a hearing on the case of the illegitimate suspension of Parliament by Boris Johnson in the Scottish Court. Perhaps interesting news will come from this front.
The technical picture of the pound/dollar pair is unambiguous: a downward trend, the approaching moment of updating multi-year lows, the willingness of bears to continue to sell the British currency.
Nearest support levels:
S1 – 1.2024
S2 – 1.1963
S3 – 1.1902
Nearest resistance levels:
R1 – 1.2085
R2 – 1.2146
R3 – 1.2207
Trading recommendations:
The GBP/USD pair continues to move down. Thus, it is still recommended to sell the pound/dollar pair with targets of 1.2024 and 1.1963. Also today, it is recommended to closely monitor any messages from the UK, as it is impossible to exclude the growth of volatility and sharp reversals of the pair if unexpected news comes.
In addition to the technical picture, fundamental data and the time of their release should also be taken into account.
Explanation of the illustrations:
The upper linear regression channel – the blue line of the unidirectional movement.
The lower linear regression channel – the purple line of the unidirectional movement.
CCI – the blue line in the indicator regression window.
The moving average (20; smoothed) – blue line on the price chart.
Murray levels – multi-colored horizontal stripes.
Heiken Ashi is an indicator that colors bars in blue or purple.
