GBP/USD 5M

The GBP/USD currency pair once again adjusted to the level of 1.3082 on Tuesday, which it had already worked out a day earlier. Thus, a new rebound from the indicated level followed and at the moment everything is going to resume the downward trend. Of course, this is a pretty loud prediction before the two meetings of the central banks, the UK and the US. It is absolutely clear to everyone that traders might change their mood tomorrow and the day after tomorrow. Everything will depend on how decisions are made by the Federal Reserve and the Bank of England. Therefore, by and large, it makes no sense to make any forecasts now, even for today. Volatility may grow very much tonight (and it is already high now), and no one can predict where the pair will be by Thursday evening, when both meetings will remain in the past.

There were few trading signals on Tuesday. Actually, only one. The price hit the 1.3082 level by the middle of the US trading session, bounced off it and formed a very strong sell signal. After the formation of this signal, the price went down about 30-40 points, but failed to reach the nearest target level of 1,3009. Therefore, it was necessary to manually close this transaction, and it would bring a profit of 20-30 points. Considering that there was only one signal, this is not a bad result.

COT report:

The latest Commitment of Traders (COT) report on the British pound showed an increase in the "bearish" mood among professional traders. However, in general, the mood of major players has changed too often in recent months, which is clearly seen by the two indicators in the chart above. At the moment, the number of open long positions is less than the number of short positions by 13,000. Although a week ago their numbers were almost the same. We can conclude that the major players cannot make a decision on exactly how to trade the pound. Of course, with the beginning of the military operation in Ukraine, a lot has changed for traders and investors. There was outright panic in the markets for several days. But even now, when enough time has passed to calm down, the markets are still in an excited state. In addition, strong demand for the US dollar also affects the movement of the pound/dollar pair, so COT reports do not always reflect what is actually happening in the market. Although the reports on the British pound are at least a little consistent. The green line of the first indicator (the net position of the "non-commercial" group) indicates that the major players are starting to look at the short positions on the British pound again. And since this line is not far from the zero mark, the pound has a lot to go down. In general, now most factors speak in favor of the growth of the US currency and COT reports are just one of them. At this time, geopolitics is the most important factor.

We recommend that you familiarize yourself with:

Overview of the EUR/USD pair. March 16. The conflict in Ukraine is fading, but it is unlikely for a long time. Markets are waiting for the Fed meeting.

Overview of the GBP/USD pair. March 16. Boris Johnson: energy independence is the main task of Western countries.

Forecast and trading signals for EUR/USD on March 16. Detailed analysis of the movement of the pair and trading transactions.

GBP/USD 1H

The pair maintains a downward trend on the hourly timeframe, and the price does not even try to approach the downward trend line. It was not even able to work out the critical line, which is already more close to the price than the price is to it. But the strength and desire to grow is not observed right now. There are two meetings of central banks ahead, maybe after them the bulls will join the battle? We highlight the following important levels on March 16: 1.3000, 1.3082, 1.3194, 1.3273. The Senkou Span B (1.3259) and Kijun-sen (1.3095) lines can also be signal sources. Signals can be "bounces" and "breakthroughs" of these levels and lines. It is recommended to set the Stop Loss level to breakeven when the price passes in the right direction by 20 points. The lines of the Ichimoku indicator can move during the day, which should be taken into account when determining trading signals. There are also support and resistance levels on the chart that can be used to take profits on transactions. There are no important events and reports scheduled for Wednesday in the UK. Thus, traders will focus their attention only on the Fed meeting, which will end late in the evening. During the same day, it will be possible to pay attention only to the report on retail sales in America, but it is unlikely to push traders to react by more than 20 points.

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.