But after the downtrend it may hit the 3 month support line = reversal= buy
Tradingiskyle
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Slowly waiting for the opportunity lol
Pepperstone
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GBP is getting increasingly volatile as we can see at on the one-month GBPUSD implied volatility (vol) at 14.0%, relative to say AUDUSD and EURUSD vol at 9.34% and 7.57% respectively. As we can see on the daily chart , a 413-point move takes us into the top of the multi-month range, as well as the 38.2% Fibo of the April to August sell-off. As volatility is naturally directionally agnostic, so a 413-point move could take us through the lower esculents of the range at 1.2600 which you have identified and potentially into 1.2200 as well.
Currently, the prospect of Theresa May being removed from power has diminished for now, and that has supported GBP.
Fundamentally, we are having a bearish bias towards 1.2200 where we could possibly see the exhaustion of bears and bulls taking over.
Please take a look at our idea and let us know what you think.