GBP/USD 5M
The GBP/USD pair moved very actively on August 23. Especially for Monday. If we compare the movement of the euro/dollar and pound/dollar pairs, then the second one showed a much stronger movement than could be expected. And the macroeconomic background was the same for both pairs again. Both in the UK, and in the European Union, and in the US, business activity indices turned out to be worse than forecast values, nevertheless, this did not prevent the pound from growing by more than 100 points yesterday. Traders with signals were a little unlucky. You could earn much more than you eventually managed to earn with such a strong movement. However, only one trading signal was formed on Monday. Moreover, it was formed already in the middle of the entire upward movement. It should be noted that the pair moved up in the Asian trading session, and in the European and US ones. Therefore, when a buy signal was formed (almost at the beginning of the US one), most of the movement was already left behind. However, this did not stop traders from making money. The pair overcame the 1.3677 extremum level, and the price subsequently reached the extremum level of 1.3725. Accordingly, a long position should have been opened near the first level, and closed near the second. Therefore, you could earn around 30-35 points on the buy signal. Not very much, but it is still profitable anyway. The numbers "1" and "2" in the chart indicate the times of publication of British and US reports. As you can see, traders did not react to these. And in any case, after the reports were released in Britain, the pound clearly could not rise in price. Thus, most likely, the markets simply ignored all the reports of the day, trading on a pure technique.
Overview of the EUR/USD pair. 24 August. The Jackson Hall symposium could decide the fate of the pair in the coming weeks
Overview of the GBP/USD pair. 24 August. The British pound is set to rise. Only the Jackson Hall symposium can prevent this
GBP/USD 1H
The pound/dollar pair has settled above the downward trend channel on the hourly timeframe, so the trend, like the euro/dollar pair, has now changed to an upward trend. As we have said more than once, we are waiting for the resumption of upward trends for both major currency pairs. From our point of view, the US dollar has risen enough in the last couple of months and now it's time to move up. So far, the price has been able to overcome only the critical Kijun-sen line, so in the near future it will strive for the resistance area of 1.3785-1.3794, as well as the Senkou Span B line. We continue to draw traders' attention to the most important levels and recommend trading from them: 1.3590, 1.3677, 1.3725, 1.3785 - 1.3794. Senkou Span B (1.3833) and Kijun-sen (1.3707) lines can also be sources of signals. It is recommended to set the Stop Loss level at breakeven when the price passes 20 points in the right direction. The Ichimoku indicator lines can move during the day, which should be taken into account when looking for trading signals. There are no reports or other events scheduled for Tuesday 24 August in the UK and the United States. However, as shown on Monday, traders are inclined to actively buy the pound at this time, so the upward movement (and quite strong at that) can continue without macroeconomics or foundation.
We also recommend that you familiarize yourself with the forecast and trading signals for the EUR/USD pair.
COT report
The GBP/USD pair did not lose or gain a single point during the last reporting week (August 10-16). Moreover, if you look at the chart above, you can clearly see that there is no downward trend at this time. There is a correction, and the correction ends sooner or later. According to the latest Commitment of Traders (COT) reports, the major players were not very active, but still reduced their net position (green line of the first indicator). And commercial traders, on the contrary, increased it. This suggests that the upward trend is coming to an end, but at the same time, the data of the COT reports for the pound is very inaccurate, since at the time when the pound grew by those 2,800 points, which we have already mentioned, professional traders did not always increase long positions. It was on the basis of this fact that we concluded that the factor of the Federal Reserve's infusion of trillions of dollars into the US economy has a greater influence on the British currency exchange rate, which inflates the money supply and provokes inflation. Moreover, in the last few weeks, the group of non-commercial traders has been increasing buy contracts/longs (the green line rises, the second indicator rises). Thus, the bullish sentiment among the major players is strengthening again. Consequently, the pound may start to rise in price again. Changes were minimal during the reporting week. In total, professional traders have closed 2,700 buy contracts and less than 500 sell contracts. Thus, the net position decreased by 2,500. However, such changes are insignificant for the British currency. In general, now between the purchases and sales of the pound at "non-commercial" is almost complete equilibrium.
Explanations for the chart:
Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.
Support and resistance areas are areas from which the price has repeatedly rebounded off.
Yellow lines are trend lines, trend channels and any other technical patterns.
Indicator 1 on the COT charts is the size of the net position of each category of traders.
Indicator 2 on the COT charts is the size of the net position for the non-commercial group.
