GBP/USD: plan for the European session on March 21. A very important day for the pound. Brexit and interest rate

Source: Forex Analysis

To open long positions on GBP/USD you need:

The Bank of England’s decision on the interest rate will be published today, but the more important event will be the EU’s provision of postponing Brexit for the UK. Yesterday, a request was submitted to postpone the release from March 29 to June 30. If the delay is approved, the pound can strengthen its position. Consolidating above 1.3223 will be a signal to buy with the aim of testing a high of 1.3266 and 1.3316, where I recommend taking profits. In case the pound falls during the first half of the day, only a false breakdown around 1.3182 will make it possible for us to count on a new wave of growth. In a different scenario, it is best to buy on a rebound from the low of 1.3131.

To open short positions on GBP / USD you need:

Sellers of the pound will try to form a false breakdown in the intermediate resistance area of 1.3223, however, the main goal will be a breakout and consolidation below the support of 1.3182, which will lead to selling the GBP/USD towards the lows of 1.3131 and 1.3085, where I recommend taking profits. In case growth is above 1.3223, good resistance levels can be seen in the area of 1.3266 and 1.3316, from where you can open short positions immediately on a rebound. However, you must understand that any news on Brexit can provoke a sharp and strong movement of the pound to any of the parties.

Indicator signals:

Moving averages

Trade is conducted in the area of 30-day and 50-day moving averages, which indicates the lateral nature of the market.

Bollinger bands

To resume growth, bulls need a breakthrough of the upper limit of the Bollinger Bands indicator around 1.3240. In case the pound falls, support will be provided by the lower limit in the area of 1.3170.

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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