To open long positions on GBP/USD, you need:

At the end of last week, the pound rose after statements from the EU, which were about Brexit and new conditions, but then the euphoria quickly subsided, as it never came. At the moment, buyers of the pound can count on a return and consolidation above the resistance of 1.2514, which will allow them to stay above the lower limit of the new upward channel formed on July 17, and maintain a bullish trend. This scenario will lead to an update of the maximum of 1.2561 with a subsequent exit to 1.2600, where I recommend taking the profit. If the bulls fail to cope with the level of 1.2514 today, the main focus will be shifted to the support of 1.2472, which should not be missed under any circumstances.

To open short positions on GBP/USD, you need:

Sellers of the pound require the formation of a false breakout in the resistance area of 1.2514, which will be a clear signal to open short positions that will lead to a re-decrease in GBP/USD in the area of Friday's low of 1.2472. Another test of this area is sure to fail the pound even lower to a minimum of 1.2431, where I recommend taking the profit. If the bears do not show themselves from the resistance of 1.2514, it is possible to open short positions immediately for a rebound in the area of a larger maximum of 1.2561.

Indicator signals:

Moving Averages

Trading is below 30 and 50 moving averages, which indicates a possible continuation of the downward movement.

Bollinger Bands

The growth of the pound will be limited by the upper limit of the indicator around 1.2525, where you can watch sales in the morning. A test the lower border in the area of 1.2480 may also limit the bearish market in the first half of the day.

Description of indicators

• MA (moving average) 50 days – yellow
• MA (moving average) 30 days – green
• MACD: fast EMA 12, slow EMA 26, SMA 9
• Bollinger Bands 20