FX.co ★ Analysis and forecast for GBP/USD on September 24, 2020

In contrast to the euro/dollar, the GBP/USD currency pair showed a reversal signal in yesterday's trading. It is not yet possible to say if it will be a course correction or a reversal. Most likely, these dynamics of the British currency was due to the statement of a senior official that the UK is ready to conclude a deal to leave the European Union at almost any cost. However, words are still just words, and they should be followed by concrete actions, which at the moment are not observed.

Bank of England Governor Andrew Bailey will speak at 15:00 (London time) today. Perhaps the chief British banker in his speech will touch on the topic of Brexit and shed more light on this crucial issue. At the very least, today's speech by the head of the Bank of England may have a significant impact on the price dynamics of the British pound.

Daily

As you can see, following the results of yesterday's trading, a doji candle appeared on the daily chart, which can be considered a reversal model of candle analysis. Please note that yesterday's candle appeared after an attempt to break through the strong technical level of 1.2680, which failed. However, the pound bulls also failed to raise the price above the 200 exponential moving average and return it to the limits of the Ichimoku indicator cloud.

In this regard, it will be extremely important how today's trading session ends. If traders managed to raise the quote above the orange 200 EMA and complete trading within the Ichimoku cloud, the probability of a reversal will become more realistic. Otherwise, the situation for GBP/USD will continue to remain under the control of the bears. If today's day ends below yesterday's lows of 1.2674, the expected reversal candle signal will be broken, which promises a further decline for the pair, where the next target will be the important technical level of 1.2600.

H4

Despite yesterday's daily candle, which can be considered a reversal, it is still too early to take this as a fact. We need confirmation in the form of today's growth of the pair. At the time of writing the review, the pound/dollar is trading near 1.2713. If the upward movement continues, it is necessary to return trades above 1.2800. Finally, the breakout of the purple resistance line, which is drawn at points 1.3482-1.2998, will convince you of an adjustment or reversal of the course. However, before this, you will have to go up 50 simple moving average, which passes right at the resistance level of 1.2860.

According to trading recommendations, the main idea is still sales, which are better considered after corrective rises up. I suggest waiting for the pair to grow in the price zone of 1.2850-1.2860 and after the reversal patterns of candle analysis appear there, sell the British currency with the nearest target near 1.2700. More aggressive and risky sales can be tried on the pair's attempts to return above 1.2800, but even in this case, it is better to see confirmation signals and only then open short positions on GBP/USD with the nearest target at 1.2700.