To open long positions on GBPUSD, you need:
In my morning review, I drew attention to the possible growth of the pound after the release of inflation data in the UK, but it was necessary to meet a number of conditions, which the bulls did well. Fixing above the resistance of 1.2302, which is clearly visible on the 5-minute chart with a test of this level from top to bottom, was a good signal to buy the pound/dollar pair. At the moment, the bulls have built interim support of 1.2350 and while trading will be conducted above this range, we can expect the pound to continue growing to the maximum of 1.2417, where I recommend fixing the profits. In the scenario of the pair returning under the resistance of 1.2350, I recommend to exit the long positions and wait for the minimum of 1.2298 to be updated, from where to buy the pound immediately for a rebound.
To open short positions on GBPUSD, you need:
Sellers tried to return to the market several times after updating the resistance of 1.2331 and 1.2358, but nothing good came of it. At the moment, the bears will focus on returning the pair to the level of 1.2350, as a number of stop orders may be demolished below, which will quickly push the pound to the minimum of 1.2298, where I recommend fixing the profits. In the scenario of further growth of the pound/dollar pair, it is best to return to short positions only for a rebound from the resistance of 1.2417 with the goal of a downward correction of 30-40 points within the day.
Signals of indicators:
Moving averages
Trading is below the 30 and 50 daily averages, which indicates that the advantage of sellers of the pound remains.
Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger Bands
In the scenario of the pair's growth, the average border of the indicator around 1.2408 will act as a resistance.
Description of indicators
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
- Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
- MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
- Bollinger Bands (Bollinger Bands). Period 20
