All the sanctions imposed by the Western countries have so far been of a purely restrictive nature. In other words, they have been limited to a ban on doing business and the freezing of funds in accounts. However, the suspension of operations with the foreign exchange reserves of the Bank of Russia has already made investors somewhat uneasy, as the decision came very close to a direct withdrawal of funds. So, last night, the Hamburg authorities have seized Alisher Usmanov's yacht on the grounds that he is under sanctions. There are a huge number of rich people in the world who acquire not only property in Europe but all sorts of assets. In fact, some of the richest people in the world keep their capital in Western Europe. These capitals are part of the economic well-being of the European Union. Now, people have realized that European countries can take away their capital just because they don't like their behavior. So now it is inevitable that there will be a gradual withdrawal of capital from Europe. The pound has already benefited from that, by the way. Yesterday, it showed good gains unexpectedly. We are talking about enormous amounts of hundreds of billions of euros. Of course, the war in Ukraine is itself a factor in capital outflows, but it is relatively moderate and more likely even temporary. The process will not be instantaneous. It will drag on for years. So, it can still be stopped. However, Europe is making decisions which will only speed it up. The long-term prospects not only for the single European currency, but also for the economy of the European Union as a whole, look unattractive. As mentioned above, the pound was the first to benefit from such actions, as the UK became the first country to have its assets seized by lawlessness.
The GBP/USD currency pair failed to overcome last week's local low of 1.3272. As a result, there was a bounce in the price, which led to a reversal, regaining much of the decline from the start of the trading week.
The RSI is moving within the average level of 50 in the four-hour period, as evidenced by the rebound in price. It is not yet time to wait for overbought or oversold.
The Alligator H4 has a primary signal of moving lines crossing, indicating that the downward cycle is slowing down. Alligator D1 retains sell signal. There is no crossover between the MA lines.
The daily chart shows a gradual recovery of the downtrend, after a prolonged correction.
Outlook:
In this situation, the level of 1.3437 is a resistance in the way of the buyers, where previously in history there was a decrease in the volume of short positions. In this case there could be a slowdown in the upward cycle and as a result a rebound in price.
Traders will consider an alternative market scenario should the price hold above 1.3450 during the four-hour period.
Complex indicator analysis provides a buy signal in the short-term and intraday periods due to an uptrend. Technical instruments in the medium term give a sell signal due to a resumption of the downtrend.