GBP/USD 5M
Yesterday, the GBP/USD pair passed from the low to the high of the day by a bit more than 50 points. Moreover, a certain part of this distance was covered even at night, and we do not take into account Thursday evening and night trading, since at that time the results of the Federal Reserve meeting were summed up in America, which happens once every month and a half. Thus, the volatility of the pound/dollar pair during the day was very weak. Nevertheless, several trading signals were generated during the day. However, with such low volatility, they naturally did not bring much profit to traders. Unfortunately. In the morning, a report on inflation for May was published in the UK, according to which the indicator rose to 2.1% y/y. Strictly speaking, the rise in inflation is a negative factor for any currency, but in our case, the British currency rose in price after this report. However, it is not surprising at all, considering how the pair has been moving in recent weeks. Recall that the swing is clearly visible on the 4-hour timeframe. Accordingly, the pair moves in the same way on other timeframes. The first trading signal of the day was formed after the price crossed the 1.4101 extremum level and the Kijun-sen line. Here traders had the right to open long positions, but after just an hour and a half the quotes returned below the critical line, so the long position should have been manually closed at a loss of 9-10 points. Then the price bounced off the level of 1.4101 and again crossed the Kijun-sen line. In this case, it was also possible to open long positions, however, the upward movement did not continue here either. True, in the second case, there were no losses, since the price returned to the critical line and was just above it for a long time, giving traders the opportunity to close long positions at breakeven. All further signals should not have been worked out, since two false signals had already formed near the Kijun-sen line and the level of 1.4101 by that time. The results of the Fed meeting were to be summed up, so at this time it was definitely not necessary to open any positions.
Overview of the EUR/USD pair. June 17. The Fed meeting in any case will not change the pair's current state of affairs.
Overview of the GBP/USD pair. June 17. The pound was upset over the news of the pandemic in the UK. But not too much.
GBP/USD 1H
The very "swing" that we have been constantly talking about lately is clearly visible on the hourly timeframe. The pair constantly changes its direction of movement, passing approximately equal distances both up and down. Thus, the trend is formally downward, but, as in the case of the euro, this trend movement borders on the concept of a "flat". In technical terms, we continue to draw your attention to the most important levels and recommend trading from them: 1.4008, 1.4080, 1.4101 and 1.4200. These levels have not changed for a long time, because the price continues to be in a limited range. Senkou Span B (1.4159) and Kijun-sen (1.4107) lines can also be sources of signals, but they are weak in the flat. 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. No major events or publications are scheduled in the UK on Thursday, and only minor ones in the United States. Thus, during the day, traders will have to trade in the after-effects mode after summing up the results of the Fed meeting and on pure technique. At the same time, the movements can be quite active, as European investors and traders were deprived yesterday of the opportunity to work out all the information received from the US central bank and Fed Chairman Jerome Powell.
We also recommend that you familiarize yourself with the forecast and trading signals for the EUR/USD pair.
COT report
The GBP/USD pair fell by 25 points during the last reporting week (June 1-7). However, in general, no one doubts the direction of the global trend is upward, and the recent weeks' movement has been an absolute flat. The latest Commitment of Traders (COT) report showed that professional traders closed approximately the same number of Buy (longs) and Sell (shorts) contracts. It is this moment that very clearly indicates what is happening now with the pound/dollar pair. However, in general, the pound continues to grow and cannot even really correct. At the same time, the size of the net position of the major players practically does not change. Changes in the net position have been insignificant since the beginning of March, which is shown by both the first and second indicators. Moreover, the pound continues to show growth, it simply does not commensurate with the bullish sentiment of non-commercial traders. Thus, we continue to talk about such a global factor as the injection of trillions of dollars into the American economy, which, from our point of view, is the main reason why the pound strengthens. Look at the previous section of the trend between October 2020 and March 2021. The pound gained 1,400 points, while the net positions of commercial and non-commercial groups of traders remained practically unchanged. That is, large players did not increase their long positions at this time. At the same time, the pound grew by 1400 points practically without a single pullback.
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.
