The pair made an upward reversal on Wednesday after breaking through the support line 1.2274 (presented in a red bold line) and testing the level of 1.2399 - a 38.2% pullback level (presented in a red dashed line). Today, the upward pullback movement may continue, depending on the news. Economic calendar news for the pound is expected at 08:30 UTC, and for the dollar at 12:30 and 14:00 UTC. The EU leaders are set to discuss a $ 2.2 trillion recovery plan.
Trend analysis (Fig. 1).
Today, the upward pullback movement may continue from the support line 1.2313 (presented in a red bold line) with the first target at 1.2447 - a 50% retracement level (presented in a red dashed line). In case of breaking this level up, the price may continue to move upward with the target at 1.2494 - a 61.8% retracement level (presented in a red dashed line).
Fig. 1 (daily chart).
Comprehensive analysis:
- Indicator analysis - up;
- Fibonacci levels - up;
- Volumes - up;
- Candlestick analysis - down;
- Trend analysis - up;
- Bollinger Lines - up;
- Weekly schedule - up.
General conclusion:
Today, the price may continue to move upward with the target at 1.2494 - a 61.8% pullback level (presented in a red dotted line).
Another possible scenario is a bullish trend from the support line 1.2313 (presented in a red bold line), with the target at 1.2176 - a 38.2% retracement level (presented in a blue dashed line). If this level is broken down, the price may continue to move downward with the target at 1.2031- a 50.0% retracement level (presented in a blue dashed line). This scenario is only possible in case of bad news for the pound.