Brent oil is currently on a bullish trend, facing resistance near $84 and supported by the 200-day EMA. Breaking above this level could lead to a climb towards $90. Short-term support is observed around $80, backed by the 50-day EMA. As summer approaches and travel increases, crude oil tends to benefit from seasonal patterns. Despite temporary setbacks, buying...
GBP/USD: the main pair of the day
2020-06-19 • Updated
Investors are confused as both negative and positive factors weigh on GBP. Which side will win?
Let’s get it sorted out. We can notice on the GBP/USD chart that the price is stuck near 1.24. Most traders can’t choose the team: bears or bulls.
What's happening now?
On the bearish side, the Bank of England boosted the bond-buying program by only 100 billion pounds – much less than everybody expected. Most economists criticized it as the country hasn’t yet recovered and needs more support. Also, concerns about the second coronavirus wave weigh a lot on the sentiment-sensitive pound. New cases in Beijing, Texas and Florida have just fueled that worries.
On the bullish side, actual UK retail sales turned out better than the forecasts. Sales rose by 12% – twice more than analysts anticipated. That basically means that the British economy has started recovering. That is great, but most investors shrugged off that news.
What upcoming events may move GBP?
The UK manufacturing PMI will be released on June 23 at 11:30 MT time. If numbers come better than expected, the British pound will gain.
Brexit trade talks will have a huge impact on GBP. There are optimistic prospects that the EU and the UK can reach a deal even before the agreed deadline, that is scheduled for the end of this year. The UK Prime Minister Boris Johnson really wants to end talks as soon as possible. GBP will definitely benefit, if this happens.
The GBP/USD pair has just broken the support line at the 50-day moving average at 1.2400. That gave a fresh stimulus to sellers. We can assume that the price may fall to 1.2300, when it will meet the barrier. The next strong support will be at the one-month low at 1.2100. Keep an eye on the resistance at 1.2500. The move above it will push the price upward to 1.2680.
Bearish Scenario: Sales below 78.99 with TP1: 77.93, TP2: 77.45, and upon its breakout TP3: 76.56 and TP4: 75.70 Bullish Scenario: Purchases above 78.00 (wait for a pullback to this area) with TP1: 1679.00 (uncovered POC*), TP2: 79.33, and TP3: 79.66 intraday
Bearish Scenario: Sales below 80.00 with TP1: 79.34, TP2: 78.94, TP3: 78.55, and 78.00 Bullish Scenario: Buys above 78.00 (wait for a retracement to the zone) with TP: 79.34 TP2: 80.00, and TP3: 81.00
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