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flag ★ Overview of GBP/USD on September 11th. Forecast according to the "Regression Channels". Jeremy Corbyn is going to initiate a vote for a second referendum

Forex Analysis:::2019-09-11

Overview of GBP/USD on September 11th. Forecast according to the "Regression Channels". Jeremy Corbyn is going to initiate a vote for a second referendum

4-hour timeframe


Technical data:

The upper channel of linear regression: direction – down.

The lower channel of linear regression: direction – up.

The moving average (20; smoothed) – up.

CCI: 75.6546

The British pound continues to feel the support of the forex market thanks to the defeats of Boris Johnson in parliament and several unexpectedly strong packages of macroeconomic information from the UK. It is safe to say that the pound does not like Boris Johnson. However, the disgraced prime minister is now in the shadows. He has 5 weeks, during which the parliament will not interfere with him to implement his ideas, as well as 5 weeks to figure out how to circumvent the law prohibiting him to implement Brexit without a "deal" until October 31.

We have already reported that Boris Johnson may resort to frankly unfair play and send two letters to EU leaders at once. One will contain a request to transfer Brexit on January 31, 2020, and the other is a personal request of Johnson not to move Brexit. The irony of fate is that the EU can satisfy the first request and ignore the second. If this happens, then on the events in the UK over the past three years it will be possible to shoot a comedy series. It is worth noting that only Donald Trump likes Boris Johnson, as the US President has a great desire to quarrel with the EU and Britain. That is why he promises Johnson a "fantastic" trade deal and supports Johnson's desire to "divorce" the EU as quickly as possible and without an agreement. But in the European Union, which also does not particularly benefit Brexit without a "deal," Johnson is unlikely to have much support. Most likely, it is simply absent. Moreover, the EU is unlikely to want to lose the UK, and although it does not recognize it openly, it will do everything to slow down the process of withdrawal of the Kingdom from the Alliance. Thus, Brussels may approve the postponement of Brexit at a later date. If this happens, Johnson can safely write a letter of resignation and carry it for a signature to Queen Elizabeth II.

At the same time, Johnson's opposition in the person of Corbyn, the Labor Party and many deputies from other parties does not go on vacation but continues to work outside the parliament. It is expected that today, September 11, deputy leader Tom Watson and labor party leader Jeremy Corbyn will call for a second referendum in which the people of the UK will be called to decide whether to leave the European Union according to Johnson's plan or it is better to remain in the Alliance? Watson notes that Boris Johnson has already proved that the current Brexit crisis can be solved only with the help of the people, and not by re-election to parliament.

The technical picture of the pound/dollar pair shows an upward trend and the absence of a strong correction. Since there will be no important publications in the UK today, a new round of correction may begin, which can be determined by the reversal of the Heiken Ashi indicator down.

Nearest support levels:

S1 – 1.2329

S2 – 1.2268

S3 – 1.2207

Nearest resistance levels:

R1 – 1.2390

R2 – 1.2451

R3 – 1.2512

Trading recommendations:

The GBP/USD pair continues to move upwards. Thus, traders are advised to continue buying the pound with targets of 1.2390 and 1.2451. It is recommended to return to the sales of the British currency not earlier than the consolidation of the pair below the moving average, which is not expected soon.

In addition to the technical picture, fundamental data and the time of their release should also be taken into account.

Explanation of illustrations:

The upper linear regression channel – the blue line of the unidirectional movement.

The lower linear regression channel – the purple line of the unidirectional movement.

CCI – the blue line in the indicator regression window.

The moving average (20; smoothed) – the blue line on the price chart.

Support and resistance – red horizontal lines.

Heiken Ashi is an indicator that colors bars in blue or purple.

Paolo Greco
Analyst InstaForex
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