Review and dynamics
After the decline in the pair GBP/USD by over 11% (1500 points) due to the results of the UK referendum, the pound started to regain slowly in the currency market. The pair GBP/USD is moving in the narrow channel on the hourly chart with the nearest resistance level of 1.3670 (closing price of the "black Friday" and ЕМА144 on the hourly chart), 1.3800 (ЕМА200 on the hourly chart), 1.3860 (the lows of the last wave of decline from the level of 1.5230 in mid-December 2015, from which the pair began the rise to the highs of June at 1.5000 (Fibonacci 0%).
Today, the pair GBP/USD has grown by 40 points. However, some important news is scheduled to release today, including a speech by the head of the Bank of England Mr. Mark Carney at 17:00 (GMT+2). Volatility in the pair GBP/USD can rise significantly.
Until situation in the markets settles down, the pair can move to either direction. The rise and consolidation of price above yesterday's highs at the level of 1.3530 can trigger further rise in the pair GBP/USD. Break down of the resistance level 1.3860 can provoke recovery of the pound. There is a high chance that the pair will reach new lows and fundamental factors can have a stronger influence on the pair than technical analysis. On the weekly chart a new descending channel has been formed and the pair GBP/USD is at the lower line of this channel. However, the angle of slope can change and the range may widen. The rise in the pair and further correction in the pair will be possible if the price goes down below 1.3650 (lows of 2009 and 2001) and 1.3670 (closing price of last Friday).
Support levels: 1.3400, 1.3350, 1.3300, 1.3230 and 1.3200.
Resistance levels: 1.3530, 1.3650, 1.3670, 1.3700, 1.3800 and 1.3860.
Sell Stop: 1.3420. Stop-Los: 1.3460. Take-Profit: 1.3350, 1.3300, 1.3230 and 1.3200.
Buy Stop: 1.3510. Stop-Loss: 1.3440. Take-Profit: 1.3600, 1.3650, 1.3670, 1.3700, 1.3800 and 1.3860.
In the narrow channel
Indicators give signals to open short positions