Today, 21 February, on the eve of the opening of trading in Europe, the British pound is trading at 1.3982 (-0.09%) in the currency pair GBPUSD, ie with a slight decline. One of the key factors putting pressure on the pound in recent days, a decline in the euro against the dollar. Between European currencies (the euro and the pound) traditionally have a good positive correlation.
Today, the volatility of the pound could rise significantly against the publication at 12:30 (GMT + 3) on the labor market statistics in the UK in January and a speech by Bank of England Governor Mark Carney on the report on inflation, which will begin at 17:15 (GMT + 3) .
On the daily time frame (D1), while GBPUSD is stored within the upward movement, at the moment there is a correction in the trend:
On the four-hour timeframe (H4) the situation is much more interesting - there is an attempt to form the beginning of a downtrend:
I suppose that if today's labor market statistics in the UK (in the first place on wages) would not be very good, the GBPUSD continues its downward movement (scenario C1), falling approximately to the level of the previous depression (1,3820-1,3880) . In case of good statistics on the labor market, I think that the GBPUSD bounced up to the trendline potential downward movement (scenario C2), ie to about 1,4050-1,4070 level.
Vesselin Petkov Alpari