For the last trading day, the currency pair pound / dollar showed high volatility of 127 points, resulting in a wide amplitude, which, in principle, did not lead to anything solid. From the point of view of technical analysis, we see an amazing amplitude - high 1.2811 and low 1.2684, where, as a result, the quote crept in almost the same place where it started. The gaps on the background of the information flow did not change the overall picture. The short positions in the form of bearish interest prevail in the market, which reflects the fastest recovery. What happened on the market? Overlapping each other informational news flow and now in order. Yesterday, statistical data on sales in the secondary housing market were published in April in the United States, where they were waiting for growth from 5.21M to 5.35M, and as a result, it was reduced to 5.19M. At the same time, it became known that at 15:00 Universal time, Prime Minister Theresa May will speak at the British Parliament. On low volumes that we saw last day, speculators quickly pushed through the quotation, statistics on the US, frankly, was not very good, while Theresa's unscheduled speech with the promise of a possible new proposal about Brexit played out the speculators' imagination, as a result - the initial surge upwards. Next, we see a sharp recovery quotes, the reasons? Everything is quite simple, this promise comes from the background of information, in particular, the very speech of the Prime Minister and the developing noise on it.
The new version of the agreement, with the old ones, made several concessions to the Labor Party on two basic requirements: the Customs Union with the European Union and the need for a new referendum. These demands were put forward by the Labor Party during the recent inter-party negotiations. The new agreement also contains Theresa May's previous promises to include provisions that harmonize workers' rights and environmental protection with EU rights.
A few minutes after May's speech ended, the backlash began. Laborists insist that this agreement be brought to a general referendum, without agreeing it in parliament. At the same time, Boris Johnson, so to speak, the future candidate for the place of Theresa May, traditionally, said: "I will not vote for it ...".
As a result, against the general information background, the pound quickly slipped to the marks of the beginning of the day and continued to decline smoothly.
Today, in terms of the economic calendar, we have data on inflation in the UK, where they expect an acceleration of 1.9% to 2.2%, which is quite positive news amid the overbought pound. Although, there is a possibility of whether this news will play, but do not forget about the general negative background in Britain. Next, we have a key event. The publication of the minutes of the meeting of the Federal Commission on open market operations. Everything is ambiguous here, since everyone is concerned about the fate of the refinancing rate. But for a long time, the Fed representatives have been moving away from a solid answer, referring to what will be seen. For this reason, it will not be so that the words regarding the rate will be removed from the protocol altogether. Thus, the news will be in the background, and the dollar may lose its position against the background of positive statistics from the UK and general overheating.
Analyzing the current trading chart, we see that bearish interest still prevails in the market and the quotation is rapidly going down, overcoming the minimum of the past day. It is likely to assume that the previously projected coordinates in the face of the level of 1.2620 is a very real mark. However, we should not forget about the upcoming statistics for Britain. Thus, we are waiting for a convergence with 1.2620, then we can analyze the fixation points and the news background. In case of retention of downward interest and price fixing lower than 1.2600, a further decline towards 1.2500 can be considered.
- Positions to buy will be considered, even in the case of any slowdown in working out near the level of 1.2620, with support for the news background.
- Sell positions are held towards the level of 1.2620. Further analyze the behavior of quotes and fixation points.
I would like to retreat a little from the above and suggest that you look at the daily GBPUSD chart, what do you see? Unreal reduction, without any kickbacks and corrections, oversold is overwhelming, and if it were not for the informational background, we can quickly corrected, do not forget about it.
Analyzing a different sector of timeframes (TF), we see that indicators in the short, intraday and medium term remain in a downward phase against the general background of the market.
Weekly volatility / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.
(May 22 was based on the time of publication of the article)
The current time volatility is 50 points. Against the background of the news background, volatility may remain high.
Zones of resistance: 1.2770 **; 1.2880 (1.2865-1.2880) *; 1.2920 * 1.3000 **; 1.3180 *; 1,3300 **; 1.3440; 1.3580 *; 1.3700
Support areas: 1.2620; 1,2500 *; 1.2350 **.
* Periodic level
** Range Level
*Analiza tržišta koja se ovde nalazi namenjena je boljem razumevanju tržišta i ne pruža instrukcije za vršenje trgovanja.
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