GBP/USD: ambiguous trading dynamics 04 March 2021, 09:28

GBP/USD: ambiguous trading dynamics

04 March 2021, 09:28

Scenario
Timeframe	Intraday
Recommendation	SELL STOP
Entry Point	1.3895
Take Profit	1.3800
Stop Loss	1.3955
Key Levels	1.3760, 1.3800, 1.3857, 1.3900, 1.4000, 1.4050, 1.4100, 1.4150

Alternative scenario
Recommendation	BUY STOP
Entry Point	1.4005
Take Profit	1.4100
Stop Loss	1.3940
Key Levels	1.3760, 1.3800, 1.3857, 1.3900, 1.4000, 1.4050, 1.4100, 1.4150

Current trend

GBP is trading with ambiguous dynamics during today's Asian session, consolidating near 1.3950. Investors expect the emergence of new drivers, which may be the data on the US labor market for February that will be published on Friday.

However, the markets have not experienced a lack of macroeconomic statistics throughout this week. Markit Services PMI in the UK in February fell from 49.7 to 49.5 points, never reaching 50 points. US business activity statistics were mixed. Markit Services PMI rose from 58.9 to 59.8 points, while the similar index from ISM, on the contrary, fell sharply from 58.7 to 55.3 points.

The ADP report on nonfarm payrolls, which reflected an increase in jobs of only 117K in February after an increase of 195K in the previous period, also remains without due attention at the moment. Today, traders will be focused on the speech by the Fed Chair Jerome Powell, as well as the updated statistics on jobless claims in the US.

Support and resistance

In the D1 chart, Bollinger Bands are reversing horizontally. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD is declining keeping a weak sell signal (located below the signal line). Stochastic, having retreated from its lows, reversed upwards, indicating the risks of corrective growth in the ultra-short term.

Resistance levels: 1.4000, 1.4050, 1.4100, 1.4150.

Support levels: 1.3900, 1.3857, 1.3800, 1.3760.

Trading tips

The breakdown of 1.3900 may serve as a signal for new sales with the target at 1.3800. Stop-loss – 1.3955. Implementation time: 1-2 days.

A rebound from 1.3900 as from support followed by a breakout of 1.4000 may become a signal for new purchases with the target at 1.4100. Stop-loss – 1.3940.