The GBP/USD pair returned to the level of 1.2342 on Tuesday, and today it rebounds from this level, according to the hourly indicator. As a result, there was a reversal in favor of the US dollar, and a new downward trend toward the level of 1.2238 was initiated. Traders will be able to anticipate sustained growth toward the following level of 1.2432 if closing quotes surpass 1.2342. I anticipate the British pound to experience another decline after closing under the upward trend channel.

For the pound, the speeches of Andrew Bailey, Governor of the Bank of England, were the only events during the first two days of the week. Bailey didn't mention anything significant, though. In his speech, he gave the issues of bank failures in the US and the EU more consideration. He specifically referred to Silicon Valley Bank's collapse as the quickest since Barings while also stating that these financial market developments will not have an impact on the UK banking system. The need for an additional interest rate increase was also mentioned by Bailey, who made it plain that the end of the increase in the cost of borrowing is near. On Monday and Tuesday, neither the British nor the Americans received any additional compelling news.

The information backdrop is currently empty as well. Given this, the graphical analysis should receive more focus in the present. The pound has rebounded twice from the level of 1.2342 in the past week, and traders may now be anticipating another decline in the pound. Nothing will have an impact on the traders' attitudes today. The US and UK GDP report for this week will be made public tomorrow and the day after tomorrow, respectively. However, I don't anticipate them having much of an impact on traders' attitudes either.

The pair reversed course in favor of the British pound on the 4-hour chart and started to rise again toward the level of 1.2441. However, the MACD indicator has already formed the third straight "bearish" divergence, which again enables us to expect a reversal in favor of the US dollar and a small decline in quotes. Two strong sell signals can be obtained along with the hourly chart's potential rebound from 1.2342.

Report on Commitments of Traders (COT):

Over the past reporting week, the attitude of traders in the "Non-commercial" category has hardly changed. The number of Long contracts held by investors dropped by 3682 units, while the number of Short contracts dropped by 498. The major players' overall outlook is still "bearish," and there are still more short-term contracts than long-term contracts. Although things have been steadily moving in favor of the British pound over the past few months, there are still a lot more speculators holding long positions than short ones. As a result, the pound's chances are still looking up, but the British pound hasn't changed much over the past few months. There was a break outside the downward corridor on the 4-hour chart, and the pound is currently supported. I do observe that several current factors are at odds with one another, and the information background does not offer the pound much support.

News calendar for the United States and the United Kingdom:

In the UK and the US, there are no noteworthy activities scheduled for Wednesday in the economic calendars. The information background will not affect the mood of traders today.

Forecast for GBP/USD and trading advice:

When the British pound rises above 1.2342 with a target of 1.2238, sales of the currency are possible. I don't think it makes sense to buy the pair at this point because the hourly chart's closing was made under an ascending trend corridor. However, if the price closes above 1.2342, you might want to think about purchasing small lots with a 1.2432 target.