4-hour timeframe
Technical details:
Higher linear regression channel: direction - upward.
Lower linear regression channel: direction - downward.
Moving average (20; smoothed) - upward.
CCI: 177.7892
The British pound on the first trading day of the new week continued to move upward. Recall that some analysts concluded on Friday that reports on Nonfarm Payrolls and unemployment in the United States will be worked out on Monday. We also admitted this possibility, however, the markets have already forgotten about Friday's statistics. The pound, which has adjusted by 560 points after a 2,800-point upward trend, is once again tearing up. It does not care about strong data from overseas or a failed fundamental background from the UK itself. However, we have repeatedly stopped at listing a whole list of factors, according to which the pound should have started to fall in price last year, and now it should be around the level of $ 1.30. However, the markets believe otherwise. First, the "speculative" factor remains, which still does not allow the pound/dollar pair to even adjust normally. Secondly, the global fundamental factors remain in force, according to which the money supply in the United States continues to grow at the highest rate, displacing all other macroeconomic factors. Simply put, dollars are becoming more every day, so for one pound sterling, they begin to give more and more American currency. As Joe Biden and the US Congress are on the verge of approving a new $ 2.6 trillion stimulus package, and Americans are on the verge of getting $ 1.5 trillion out of their pillows and starting to spend it, the US currency is starting to feel pressure again. Strangely, the European currency is not falling now. In the European Union, there are serious epidemiological problems.
Meanwhile, in the UK, the Medicines and Healthcare Products Administration reported about 30 cases of blood clots after using the AstraZeneca vaccine. Earlier, Boris Johnson, in response to the actions of the authorities of some EU countries to suspend vaccination with this drug, said that more than 11 million vaccinations with this vaccine were carried out in Britain and there were no cases of thrombosis, especially with a fatal outcome. As we can see, the Prime Minister was wrong in his statement, since in reality there were at least 30 such cases and 7 people died. We are talking about several tens of millions of injections made by a British-Swedish drug. The number of "victims" of the vaccine is very small. However, the doctors themselves can not even make an unambiguous conclusion that it is the vaccine that provokes the appearance of blood clots. However, in some European countries, the use of the drug was again suspended, and in some - not recommended by the local Ministry of Health. For example, in Germany, the drug AstraZeneca is recommended for use only for people over 60 years of age, since all those who died from thrombosis were people of pre-retirement age.
Meanwhile, exactly three months have passed since the "divorce" of the European Union and the United Kingdom. And so far, it is very difficult to find positive moments from the Kingdom's exit from the EU. More journalists and experts note that neither of them has received many benefits yet. Of course, the UK has been allowed to develop in the way it wants. But at the same time, it lost a huge European market, which hit its business hard. For example, London, which has always been considered the world's financial center, is already inferior to Amsterdam. The trade agreement does not define a large number of areas and issues. For example, the service sector and the financial sector, which are so important for Britain. Moreover, British manufacturers have also realized that the trade agreement does not work very well in practice. For example, seafood exports to EU countries fell by 90% in the first months of 2021. Thus, London has gained total control over its waters. More and more experts also note the somewhat cool attitude of the European Union towards Britain. London has already complained publicly several times that Brussels does not treat all its partners equally. The European Union now adheres to the policy of "you wanted to leave the EU, now solve your problems". London was not prepared for this development. Boris Johnson believed that the country would leave the jurisdiction of Brussels, but at the same time, nothing would change in terms of financial, trade, and economic relations between them. In practice, the European Union has begun to implement its threats. Representatives of Brussels have repeatedly stated that London will not be able to enjoy all the preferences of EU membership without being a member. Thus, now there is no free trade turnover between the bloc and the kingdom, a lot of checks and inspections are carried out at the borders, accompanied by the study of documents, certificates, and permits, which complicates not only the export-import operations themselves but also significantly delays each of them.
Therefore, in normal times, we would say that the pound with such a state of its economy can not move in any other way than down. But now the markets are still under the impression of a "speculative" factor, and the pound may even be growing on its own. Simply because there are more dollars in the foreign exchange market.
The average volatility of the GBP/USD pair is currently 81 points per day. For the pound/dollar pair, this value is "average". On Tuesday, April 6, therefore, we expect movement within the channel, limited by the levels of 1.3822 and 1.3984. A reversal of the Heiken Ashi indicator back down may signal a new round of downward correction.
Nearest support levels:
S1 – 1.3885
S2 – 1.3855
S3 – 1.3824
Nearest resistance levels:
R1 – 1.3916
R2 – 1.3947
R3 – 1.3977
Trading recommendations:
The GBP/USD pair resumed its upward movement on the 4-hour timeframe. Thus, today it is recommended to stay in the buy orders with the targets of 1.3947 and 1.3984 until the Heiken Ashi indicator turns down. Sell orders should be opened after overcoming the moving average with targets of 1.3763 and 1.3702 and keep them open until the Heiken Ashi indicator turns up.
