By the end of the last trading week, the currency pair pound / dollar showed, we can already say, stable volatility in the amount of 73 points, as a result of pulling into a closely located level. From the point of view of technical analysis, we saw that the quotes reluctantly continued the upward movement, moving closer to the near level of 1.2770. Considering the graph in general terms, we see that the pound managed to grow a little more, and probably dragged its rapidly growing euro due to the high correlation. The clock part is still more prone to the correction phase, and now, the main question is whether the level of 1.2770 can play the role of resistance to restore the original stroke.
Moving on to the information and news background, we see that the key event on Friday was the report of the United States Department of Labor, where they published devastating data about NonFarm. What we have? New jobs were created only 75 thousand in comparison with the previous period of 224 thousand. The data is actually staggering, in addition to everything, the average hourly wage (compared to the same period last year) decreased from 3.2% to 3.1 %. Now, we understand the reason for the further strengthening of the British currency, since the dollar felt pressure on all fronts. Let me remind you that even on June 5, the ADP report stunned all the data on the decline, which we saw later.
We close the information and news background, as always, with Brexit. On Friday, the Prime Minister left her post safely, and she's also the leader of the Conservative Party. Theresa May, saying: "I'm very sorry that I couldn't complete the exit of Great Britain from the European Union, noting that I was very proud of the progress that was made over the years." What kind of progress has been made is really incomprehensible. She will continue to perform her duties until a successor is chosen. This process can take several weeks.
In turn, a key candidate for the prime minister's place, Boris Johnson, having heard a lot about Donald Trump, said that Britain would not pay the EU $ 50 billion without an acceptable Brexit deal.
Today, in terms of the economic calendar, we have data on UK GDP, where a slowdown is expected from 1.9% to 1.8%, while at the same time, data on manufacturing output will be published, and they are also expected to decline from 2.6% to 2.2%. In the afternoon, there will be data on the number of open vacancies in the JOLTS labor market in April in the USA, where they expect a decline from 7.488M to 7.240M.
Further development
Analyzing the current trading chart, we see that the quotation felt resistance at the level of 1.2770 and returned to the area at 1.2700 where Friday started the day. It is likely to assume that a temporal amplitude of 1.2680 / 1.2740 is possible, where traders analyze the behavior of quotes and fixation points for further layout of bars.
Based on the available information, it is possible to expand a number of variations, let's consider them:
- Positions for purchase is considered in the case of price fixing higher than 1.2770.
- Positions for sale are considered in the case of price fixing lower than 1.2668.
Indicator Analysis
Analyzing a different sector of timeframes (TF), we see that indicators in the short-term perspective have changed from an ascending plan to a descending one due to the recovery process and the level of 1.2770. The intraday and mid-term outlook still maintains an upward interest, but the indicators are already on the sidelines of a mood shift.
Weekly volatility / Measurement of volatility: Month; Quarter; Year
Measurement of volatility reflects the average daily fluctuation, based on monthly / quarterly / year.
(June 10 was based on the time of publication of the article)
The current time volatility is 39 points. Analyzing the behavior of quotes relative to the previously designated boundaries, as in the case of their breakdown, the volatility can accelerate.
Key levels
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
