GBP/USD – 4H.
As seen on the 4-hour chart, the GBP/USD pair continues the growth process in the direction of the correction level of 76.4% (1.3044), without showing any signs of nervousness. The further the Brexit "No Deal" is from the horizon, the more traders look towards buying the British currency, as overall demand for the dollar has fallen significantly recently, following the deterioration of economic reports and the Fed's rate cut. The rebound of the pound/dollar pair from the Fibo level of 76.4% will work in favor of the US currency and some fall in the direction of the correction level of 61.8% (1.2836). Consolidation above the Fibo level of 76.4% will increase the chances of continued growth towards the next corrective level of 100.0% (1.3378).
If you look at the situation around Brexit as if from the outside, it becomes clear that the exit from the European Union by any means under any scenario is wanted by only one person in the vastness of Europe – Boris Johnson. And one man across the ocean is Donald Trump, who fiercely supports Boris Johnson. Trump's motivation and desires are clear as day. The weaker other countries and blocs, the stronger the United States. If Britain leaves the EU, this will weaken the Union, which is naturally good for America, which soon can strike in the form of duties on several European-made goods. Boris Johnson himself has the idea of a fix, wanting to connect the British exit from the EU with his name. Whether this is the only reason, it is difficult to say, but from the outside, it looks that way. Johnson's statements were too loud. His words "I'd rather die in a ditch than ask for a reprieve" have already reappeared in all periodicals as a mockery since Boris Johnson yesterday asked for a reprieve from the EU. He could not do otherwise, because the Parliament by a majority of votes obliged him to take such a step. Johnson, in response, made a very weak "knight's move", adding to the official request for the postponement of Brexit, he also wrote a letter from himself, in which he stated that he considered the transfer of the date to be unprofitable for both the EU and the Kingdom. The motivation of the UK Parliament is also clear. Most of the 600 politicians understand that Brexit "No Deal" will be devastating for the country's economy and so far have been quite successful in restraining the impulses of Boris Johnson, who is rapidly losing his political ratings.
The information has already appeared that the Labor Party wants to unite with other parties and opposition opponents of Brexit "No Deal" to organize a second referendum. Today, it was also reported that the EU ignored Johnson's second letter and is ready to grant a reprieve to the UK. The EU is also well aware that the loss of the Kingdom will weaken the bloc. So it turns out that the European Parliament, the British Parliament are waging outright war against the Prime Minister, and the outcome of this war depends largely on the opposition British deputies. The pound feels that Boris Johnson's plans are crumbling before our eyes and responds with growth.
What to expect from the pound/dollar currency pair today?
The pound/dollar pair closed above the Fibo level of 61.8%, so I expect today to continue growth in the direction of 1.3044 and 1.3378. Traders' optimism knows no limits. It is the traders who are now pushing the pound up, thus supporting the war between the two Parliaments against Johnson.
The Fibo grid is based on the extremes of March 13, 2019, and September 3, 2019.
Forecast for GBP/USD and trading recommendations:
I recommend staying in purchases with a target of 1.3044, as the close above the Fibo level of 61.8% was executed with the stop-loss order below the level of 1.2836.
I recommend considering selling the pair with the target of 1.2501 today if the consolidation under the Fibo level of 50.0% is performed.
