4-hour timeframe

Technical data:

The upper linear regression channel: direction – down.

The lower linear regression channel: direction – down.

The moving average (20; smoothed) – down.

CCI: -129.1801

On Monday, June 17, the euro/dollar pair began an upward correction and the pound/dollar continued to fall as if nothing had happened. New information about the Brexit procedure was not available to traders on Monday, as well as any other macroeconomic information. And as we all see, this did not prevent traders from continuing to get rid of the British currency. The pair has successfully updated its previous local lows and now seems to have headed for the lows of 2018-2019, and then for the lows of 2017. From our point of view, only what had to happen happened. We have repeatedly written that for the formation of an upward trend for any currency, a fundamental background supporting in the long term is needed. The pound sterling in the last three years does not have such a background, so Brexit puts pressure on the macroeconomic indicators of the Kingdom, and investors refuse to buy the pound sterling, which only gets cheaper in the world markets, because of the complete political fragmentation of the government. Thus, the forecast for the GBP/USD pair for the next few months remains the same – a systematic decline until the elections of the Prime Minister are completed and the "divorce" between the EU and the UK is completed, at least somehow. Up to this point, we believe that it makes no sense to count on a serious strengthening of the British pound. Today, in the late afternoon, there will be a speech by the head of the Bank of England Mark Carney, who most likely will not be interested in the markets.

Nearest support levels:

S1 – 1.2512

S2 – 1.2451

S3 – 1.2390

Nearest resistance levels:

R1 – 1.2573

R2 – 1.2634

R3 – 1.2695

Trading recommendations:

The GBP/USD pair continues its downward movement, so today, June 18, it is still recommended to trade on the downside with the targets of 1.2512 and 1.2451. The color of 1-2 bars in purple will signal the beginning of the correction.

It will be possible to buy the pound/dollar pair not earlier than reversing above the moving average, but even in this case, the purchases will be associated with increased risks, as the bulls remain very weak due to the situation in the UK.

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

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

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

Murray levels – multi-colored horizontal stripes.

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