GBP/USD: technical analysis 31.12.19

Current trend

The GBP/USD pair begins today’s trading with a slight bullish bias. At the moment the price has met the resistance at the level of 1.31354. The instrument has the potential for upward movement, but the downward correction is not excluded. If the "bulls" manage to raise the rate above the level of 1.31360, the upward movement can continue to the area of 1.31496, 1.31836. The area of 1.31836 will be a key bullish target, that can prevent the instrument from growing, as the possibility of the reverse of the price is high there.

Alternative scenario

The downward rebound from 1.31354 and pullback below 1.31287 will be a sign of downward correction and give a prospect of decline to 1.30855-1.30615 support. This mark is coincided with the middle line of Bollinger Bands and can activate an upward rebound. However, the decisive break of 1.30615 is needed to indicate the downward trend resumption. In this case, the next targets of sellers will be the level of 1.30313-1.30005.

Technical indicators

Technical indicators maintain a buy signal, but the downward correction is possible in the short term.

Bollinger Bands are pointed upwards.

MACD is growing in the negative zone.

Stochastic has left the overbought area and is pointed downwards, reflecting the high possibility of the downward movement formation.

Support and resistance

Support levels: 1.31287, 1.30855, 1.30615, 1.30313.
Resistance levels: 1.31354, 1.31496, 1.31836.

Trading recommendations

Short positions can be opened below the level of 1.31287 with the target at around 1.30855 and stop-loss at 1.31431.
Long positions can be opened above the level of 1.31354 with the target at around 1.31496-1.31836 and stop-loss at 1.31193.

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