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Trading Conditions
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4-hour timeframe
Technical details:
Higher linear regression channel: direction - downward.
Lower linear regression channel: direction - upward.
Moving average (20; smoothed) - up.
CCI: 100.1954
On April 30, the British pound begins the same moderate upward movement that has been observed in recent days. Thus, the past day, as well as for the euro/dollar pair, did not change the balance of forces in the confrontation between the pound and the US dollar. The technical picture did not change, and the Fed meeting did not affect the movement of the pair and the preferences of traders and their activity. If a month ago we complained about ultra-high volatility and not without reason, now we can complain about quite weak volatility. For the pound, this indicator has fallen in recent weeks to a value of "less than 100 points per day". The Heiken Ashi indicator turns the bars purple again, which signals a short-term upward trend.
The flow of fundamental information from the UK is now zero. From time to time, information is received on the spread of "coronavirus" or on the lifting of certain quarantine measures, but all this information has long ceased to concern traders. It concerns ordinary people, citizens, residents of every country, and people who are ill, may get sick, may lose relatives, and have to be quarantined, but not currency traders. Only one macroeconomic report is scheduled for this week in the UK, and even then it is not the most significant. And then on Friday. And even then it will be ignored with a 99% probability. Thus, we can only pay attention to the news that is available to us. And they come mainly from overseas.
One of these topics is the upcoming US presidential election in November 2020. We have covered this topic several times already. In short, its essence is as follows. Donald Trump wants to be re-elected for a second term and, as a true businessman, is ready to go to any measures to win. But suddenly, at the beginning of this year, he was tripped up by an epidemic of "coronavirus", which simply killed all the economic progress of the world's largest economy in recent years. Moreover, experts, representatives of the Federal Reserve, as well as various rating agencies and banking conglomerates believe that the US economy will lose much more in the second quarter than 4.8% in the first. Thus, in the month of November, Trump simply will not have any trumps left on his hands to declare them to the electorate. Even now, the American President is trying to blame the epidemic in the United States on China, WHO, and the country's chief epidemiologist. In general, on anyone, just to protect themselves. However, as practice shows, it is unlikely that such measures will convince the American electorate of the need to elect Donald Trump as President for a second time. The slowdown in the US economy began one and a half to two years ago when the US leader decided that China was "treating America unfairly" and urgently needed to review trade conditions. Because of this, the world economy lost several percents of GDP, and the parties fought two years of trade battles, called negotiations. This factor alone makes us wonder whether the country needs a conflicted president who kills all the progress that the country is making while he is in power. Under Trump, the US economy grew strongly, but thanks to him, it also began to slow down. And in 2020, it risks losing trillions of GDP. At the same time, the Democrats, in particular Joe Biden, who is the main contender for the presidency, do not need to do anything. It is only necessary to point out mistakes and gaps in the actions of the current government, of which there were plenty. Starting with the same trade war with China, ending with the story of impeachment and the failure of the fight against the "coronavirus" pandemic. According to the latest sociological research, Joe Biden is ahead of Donald Trump in political ratings by 6-10%. The study shows that more than 50% of voters are ready to vote for Joe Biden, and no more than 40% for Trump if there were only two contenders. If there were more candidates, 38% would vote for Trump and 44% for Biden. And there is not a single study or poll where Trump won. Moreover, many political analysts believe that at this time, Trump is deprived of his main weapon – propaganda. Now, because of the epidemic, it is forbidden to hold rallies and any other events at which Trump could speak to the public and assure that "America has a bright future". In addition, many well-known politicians, such as Hillary Clinton and Barack Obama support the candidacy of Joe Biden. Thus, the probability of Trump's victory in the upcoming elections is falling.
The main headache of the American President remains the COVID-2019 epidemic. More than a million cases of the disease have been reported in the United States, but Trump still insists on opening economic borders and ending the quarantine. Yesterday, the US President was asked how he could comment on these figures, to which the US leader said that "eventually the number of cases will fall to zero." Journalists immediately recalled similar words of Trump in February of this year, when the number of officially registered patients in America was 15. Also, Trump did not miss the opportunity to once again boast of the success (in his opinion) in countering the "coronavirus". "You should understand that we (the United States) conduct much more testing than any other country in the world. Therefore, we find more cases, because we conduct many more tests," the American President said. However, experts in the field of sociology and medicine immediately calculated that the United States also has a much higher population than in many other countries. For example, in Italy, one test for "coronavirus" was performed for every 35 people, in Spain - for every 45, in Australia - for every 50 people, and in America - for every 60. Thus, in terms of the relative number of tests performed per capita, the United States is not in the first place in the world. But on the first in terms of the number of diseases and the number of deaths from the pandemic. It should also be added that many health experts, as well as politicians, believe that if the "lockdown" is completed, the United States may be overwhelmed by a new wave of diseases.
The average volatility of the GBP/USD pair is again decreasing and is now 98 points per day. In the last 20-25 trading days, the volatility indicators have been stable. And in the last 6 days, they do not exceed the value of 114 points. On Thursday, April 30, we expect movement within the channel, limited by the levels of 1.2369 and 1.2565. Turning the Heiken Ashi indicator down will indicate a new round of downward correction or even a possible resumption of downward movement.
Nearest support levels:
S1 – 1.2451
S2 – 1.2390
S3 – 1.2329
Nearest resistance levels:
R1 – 1.2512
R2 – 1.2573
R3 – 1.2634
Trading recommendations:
The GBP/USD pair resumed its upward movement on the 4-hour timeframe. Thus, traders are recommended to consider buying the pound today with the goals of 1.2512 and 1.2565, before the new reversal of the Heiken Ashi indicator down. It is recommended to sell the British currency no earlier than fixing the price below the moving average line with the first target Murray level of "2/8"-1.2329.
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