GBP/USD 5M
The GBP/USD currency pair was also in absolute flat last Friday. This is perfectly visible even without the formation of a horizontal channel. In principle, the pair tried to continue the upward correction the whole day, but it did not work. It tried to go below the lines of the Ichimoku indicator several times, but it was defeated here too. The UK retail sales report was published on Friday, which turned out to be worse than expected, but the market did not react to it. The US consumer sentiment report was also ignored. Thus, the past week turned out to be extremely boring and uninteresting. The flat can be kept for another week, so we remind you that a trend is your friend, not a flat. You have to be very careful when trading now.
It is still possible to single out several trading signals on Friday. We do this only for clarity, since, as mentioned above, the pair has been in a flat all day. Traders could try to reach the first buy signal when the price rebounded from the Kijun-sen area - 1.2259 - Senkou Span B. Still, the area of the three lines is strong, but, as we can see, it did not provoke a strong upward movement even once, although there were four rebounds. The very first time the price went in the right direction for only 30 points, so we managed to set Stop Loss to breakeven. However, the deal on it was closed. There was no point in working out all subsequent signals, but even if traders tried to do this, they definitely did not receive a loss, since the price could not form a single sell signal.
COT report:
The latest Commitment of Traders (COT) report again showed insignificant changes. During the week, the non-commercial group closed 800 long positions and 3,200 short positions. Thus, the net position of non-commercial traders increased by 2,400. However, the mood of major players still remains "pronounced bearish". And the pound, despite the growth of the net position, still cannot start an upward trend. The net position has been falling for three months, which is perfectly visualized by the green line of the first indicator in the chart above or the histogram of the second indicator. Therefore, two or three insignificant increases in this indicator hardly unequivocally indicate the end of the downward trend for the pound. The non-commercial group currently has a total of 92,000 short positions open and only 28,000 longs. As you can see, the difference between these numbers is more than three times. Thus, in the case of the pound, both the demand for the dollar remains high and the demand for the pound itself remains low. What to expect from the pair with such input data? Moreover, we see very well that neither macroeconomic statistics nor fundamental events support the UK currency. We can only count on corrective growth, but we believe that sooner or later the global downtrend will resume.
We recommend to familiarize yourself with:
Overview of the EUR/USD pair. June 27. Geopolitics and the foundation for the euro are not improving.
Overview of the GBP/USD pair. June 27. The British pound is mired in problems, and the market simply refuses to buy it.
Forecast and trading signals for EUR/USD on June 27. Detailed analysis of the movement of the pair and trading transactions.
GBP/USD 1H
The flat is clearly visible on the hourly timeframe. The Ichimoku indicator lines are very close to each other, which means they are very weak. Thus, everyone decides for themselves whether to trade or not to trade the pair at this time, but we warn that the trading situation for both major pairs is now extremely unfavorable - flat. Today, we highlight the following important levels: 1.1932, 1.2106, 1.2259, 1.2342, 1.2429, 1.2458, 1.2589. Senkou Span B (1.2265) and Kijun-sen (1.2249) lines can also be sources of signals. Signals can be "rebounds" and "breakthroughs" of these levels and lines. The Stop Loss level is recommended to be set to breakeven when the price passes in the right direction by 20 points. Ichimoku indicator lines can move during the day, which should be taken into account when determining trading signals. The chart also contains support and resistance levels that can be used to take profits on trades. There are no major events scheduled for Monday in the UK, and only one report in the US, on orders for durable goods. We believe that today the flat will remain or we will see new swings.
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.
