4-hour timeframe

The amplitude of the last 5 days (high-low): 54p - 98p - 77p - 117p - 113p.

Average amplitude for the last 5 days: 92p (98p).

The British pound sterling moves up with minimal volatility on the first trading day of the new week. Today is President's Day in the United States, calendars, news, it's absolutely empty for both the US and the UK. There are no new posts on the topic of Brexit. Data regarding the introduction of a state of emergency in the United States and a possible new "shutdown", have no effect on the dollar as of yet. For the British pound, the current upward correction is one of the few chances to improve its position. As we have repeatedly said, there were no fundamental reasons to strengthen the British pound. Moreover, so far, we have not even seen the light at the end of the tunnel. At the end of last year, we assumed that for the British currency, the days of certainty come after two years of absence thereof. However, experience has shown that it has been a month and a half of 2019, and "things are still there". It is still unclear whether the agreement between the EU and the UK will be signed and when will Brexit take place? The whole process lasts for more than two years, and the final date of March 29 can be easily postponed. The most surprising and discouraging fact is that it might be postponed for about a year. That is, the whole procedure will be delayed for another year. Here we are not even talking about the pound, but about the fact that the UK will remain in limbo for another year, which is unlikely to have a positive impact on the country's macroeconomic indicators. In general, the longer this epic continues, the less likely the pound is to grow in the medium and long term.

Trading recommendations:

The GBP/USD currency pair continues its upward correction. Therefore, now the longs are relevant in small lots with a target of 1.2972. At the same time, there is still no reason for a better strengthening of the British currency.

Sell positions can be resumed to support the level of 1.2786 if the bears are able to seize the initiative on the instrument and gain a foothold below the Kijun-sen critical line.

In addition to the technical picture, fundamental data and the timing of their release should also be taken into account.

Explanation of illustration:

Ichimoku Indicator:

Tenkan-sen-red line.

Kijun-sen – blue line.

Senkou span a – light brown dotted line.

Senkou span B – light purple dotted line.

Chinkou span – green line.

Bollinger Bands Indicator:

3 yellow lines.

MACD:

Red line and histogram with white bars in the indicator window.