Hello, dear friends!
Tuesday's debate in the British Parliament continues. A vote on the deal struck earlier between Boris Johnson and the EU is scheduled for the evening.
Against the background of these news, the pound moved away from highs, but there is no strong fall. Although Boris Johnson said that the failure of the vote would increase the likelihood of a hard Brexit, such a scenario is no longer taken seriously. Earlier, a request was sent to the EU for an extension of the terms of Britain's exit from the European Union, so that even if the vote is unsuccessful, it is expected to postpone the final terms from the end of October to a longer term.
Of other events, we note donald Trump's comment, in which he said that negotiations on the resolution of trade disputes are going well. In general, there has been an improvement in investor attitudes towards risky assets, with progress in the Brexit negotiations and the US-China trade war.
As for the news, on Tuesday it remains to wait for the release of statistics on real estate sales in the u.S. secondary market. The news is out at 17:00 GMT.
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According to EURUSD, the downward movement is expected to continue
On Monday, the signal for sale was received and now we are seeing its development. The goal of the downward movement is support at 1.1115, and there is also a level of 1.1106 - the upper limit of the recently broken zone of termination.
In the area of 1.1115 you can look for a reversal pattern. The target for purchases is a recent extreme at 1.1178.
Further weakening of the British pound paired with the dollar is expected
So far, resistance at 1,3000 remains insurmountable. We expect that on Tuesday the downward movement of the GBPUSD pair will continue.
Today we are working with the termination zone 1.2925-1.2962, we consider two scenarios:
- extending the upper boundary of this zone, after returning to the level of 1.2962 open deals for sale with the first goal at 1.2925;
- true support breakdown at 1.2925. Sales are possible with a retest from below this level.
The targets are 1.2887, 1.2840, 1.2755.
American strengthens in tandem with Australian dollar
Literally 4-6 points were not enough to work out the main goal on the recent upward movement. Earlier this week, the American seized the initiative and played down recent losses.
On Tuesday, we are interested in the range of 0.6861-0.6880 and the local break out zone of 0.6858-0.6863. Consider the following scenarios:
- return to the level of 0.6858 or 0.6861, after their retest can be sold with the first goal at 0.6840;
- sharp rise and return to the area of 0.6861-0.6880. When fixed above the level of 0.6861 buy with goals of 0.6880 and 0.6887.
According to USDCHF, we take only bullish signals into operation
Earlier, a bullish signal was received, at the time of the review began a downward correction. To form the entry points in Buy you need to wait for the formation of the next zone of termination, perhaps the occurrence of signals of 2 types:
- false breakdown of the lower limit of the termination;
- a true breakdown of the upper boundary.
We open deals only after the termination zone has been broken. The first target is a recent high of 0.9891.
Brent crude as a priority for buying
On the senior timeframes we see that the priority of bullish positions has not disappeared. At the beginning of October there was a break from support at 56.06 and in the medium term we expect movement to its upper border at 69.28.
On Monday, we were recalled from support at 58.09, in the coming days we expect to move to the resistance of 60.64.
I recommend looking for breakout zones as you move and work in Buy when you're pinning your schedule over their upper limits. It is possible to build a grid of profitable trades.