GBPUSD: Brexit what?
It’s all about Brexit agenda again for the pound all these days and we have witnessed some rally due to positive news (or imitations of those ?). In any case, there is not so much for optimism as Theresa May is facing a confidence vote. Call for vote piling up and 42 out of 48 necessary confidence claim letters have reportedly been collected. In any case, even if May stays, the chances for parliament approval are little if any. Therefore, we again expect very volatile week again.
And volatility is all about playing support and resistances. Technicals on 4H chart are still in favor of bearish mood and price lines all downward sloped. Besides, there are important resistance clusters 1.2885 ( as I am writing this, price is testing the level ). Also, strong 1.2920 and 1.2970 resistances will likely to sustain further rally attempts.
On 1H chart price dynamics is better emphasized. We see rally and that immediate result of this rally is a formation of support level at 1.2805. In order to continue its fall, GBPUSD shall break below this support and often this sort of setup proves to be misleading, i.e. lead to false breaks.
I will be selling from those resistance levels in anticipation of further decline. More conservative and probably prudent approach is to wait for the confirmed break below 1.2805 support.
And those trades are rather short-lived. Price dynamic may (and probably will !) change very quickly as volatility expected to be extremely high and news-driven.
Have a nice week and safe trades !