GBP/USD: plan for the European session on March 1. Brexit euphoria goes away, but problems remain

To open long positions on GBP/USD you need:

Growth this week following the news on Brexit and the likely extension of the UK exit from the EU supported the pound, but in fact nothing fundamentally changed. It is best to return to long positions after consolidating above the resistance of 1.3276, which can lead to the demolition of stop orders of sellers and a sharper upward movement to the area of a high of 1.3346, where I recommend taking profits. In the event of further downward correction, long positions can be seen at a false breakdown from the support of 1.3204 or at the rebound from the low of 1.3144.

To open short positions on GBP/USD you need:

Demand for the pound is declining, and this is expected. Failing to consolidate above the resistance of 1.3276 will be an additional signal to open short positions in order to test the lows of 1.3204 and 1.3144, where I recommend taking profits. In case there is growth in the first half of the day after the release of good data for the UK, short positions can be returned to rebound from a high of 1.3346. Of course, pound buyers will not let the pair fall so easily, and each "painful" downward movement will be accompanied by a sharp increase. There is nothing terrible in this; the main thing is that there is no update of local highs, which will indicate a resumption of the uptrend.

Indicator signals:

Moving averages

Trade is conducted below the 30-day and 50-day moving averages, which indicates a possible downward correction.

Bollinger bands

The break of the lower border of the Bollinger Bands indicator near 1.3240 will lead to a new wave of the pound's decline.

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Description of indicators

  • MA (moving average) 50 days - yellow
  • MA (moving average) 30 days - green
  • MACD: fast EMA 12, slow EMA 26, SMA 9
  • Bollinger Bands 20
The material has been provided by InstaForex Company - www.instaforex.com

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