GBP/USD: plan for the American session on July 20

To open long positions on GBPUSD, you need:

Buyers of the pound today began to actively build up long positions and achieved a consolidation above the level of 1.2571. The main goal for today will be a breakout and consolidation above the resistance of 1.2618, which will lead to a break in the bearish formation formed on July 9 this year. Demolishing several stop orders above this range will add upward momentum to the pound, which will open a direct path to the maximum of last week in the area of 1.2668, where I recommend fixing the profits. If the pressure on GBP/USD returns, a repeated test of the support of 1.2571, and the formation of a false breakout on it will be a signal to open long positions to continue growth. Otherwise, if the bulls are not active in this area, it is best to postpone purchases until the next update of the lower border 1.2517. But I recommend buying the pound immediately for a rebound only from the local minimum of 1.2446, counting on correction of 30-40 points within the day.

To open short positions on GBPUSD, you need:

The sellers had no chance to return to the market. The task for the second half of the day will be to return the pair to the level of 1.2571, which may soon become the average border of the side channel. Only in this scenario can we expect a stronger movement of GBP/USD down to the support area of 1.2517, where I recommend fixing profits. It should be understood that only a break in this range will indicate the continuation of the bearish formation formed on July 9. An equally important task for bears is to protect the resistance of 1.2618, where the upper border of the current descending channel passes. However, I recommend opening short positions from there only if a false breakout is formed to return to the support of 1.2571. If the bears are not active at this level, it is best to postpone short positions until the test of the weekly maximum of 1.2668, where you can sell the pound immediately on the rebound in the expectation of correction of 30-40 points within the day.

Signals of indicators:

Moving averages

Trading is conducted above the 30 and 50 daily averages, which indicates a serious attempt by buyers of the pound to return to the market.

Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

If the pair declines, the lower border of the indicator at 1.2517 will provide support.

Description of indicators