GBPUSD analysis – British pound recovers from 1.2080

The British pound has seen a strong bullish reversal against the US dollar, following the release of positive Brexit news on Tuesday.

21 August 2019, OctaFX – Investors have continued to worry as the risk of a no-deal Brexit has risen. In the latest turn of events, the European Union rejected the set of conditions that Boris Johnson has demanded.

Yesterday, Donald Tusk, the president of the European Council criticized Johnson for not offering a realistic alternative to avoid a hard border in Ireland. Today, investors will be paying close attention to the meeting between Johnson and Merkel. He will also meet with Macron tomorrow. An EU official quoted by the Financial Times said that:

The fact is we still need a legally operative mechanism that will ensure an open border between Northern Ireland and the Republic of Ireland while safeguarding the integrity of the EU single market. The backstop does that, and Johnson hasn’t set out an alternative to it.

GBPUSD technical analysis

The recovery from the 1.2080 level has shown that short-term bulls are back in control of the GBPUSD pair and may soon target the 1.2200 level. Given the sentiment shift in the GBPUSD pair, buying dips is current the preferred intraday strategy.

  • The GBPUSD pair is only bearish while trading below the 1.2080 level, key support is found at the 1.2050 and 1.2020 levels.

  • If the GBPUSD pair moves above the 1.2080 level, buyers may test towards the 1.2200 and 1.2250 levels.

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This article was provided by OctaFX. It should NOT substitute for professional marketing consulting. Forex margin trading involves substantial risks. Forex margin trading exposes participants to risks including, but not limited to, changes in political conditions, economic factors, and other factors. All of which may substantially affect the price or availability of one or more foreign currencies.

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