GBP/USD – 1H.
Hello, traders! On the hourly chart, the quotes of the GBP/USD pair performed an increase to the upper border of the side corridor. Thus, first, we have sideways corridors for both of the most interesting pairs, that is, there are no trends, and secondly, the US dollar is still not in demand in the foreign exchange market. On Friday, there was no news in the UK, and all the most interesting things are still happening in America. I have already said that recently, Democrats and Republicans have been actively discussing a new package of financial assistance to the unemployed, companies and the US economy as a whole. The first offered 3 trillion dollars, the second – one. In the end, the parties never came to a compromise and the package was never accepted. Against this background, several of Donald Trump's executive orders, which he signed last week without even coordinating them with Congress, look not so much an excess of authority, since the President provided at least some assistance to the unemployed, who were left without crisis allowances since August 1. However, many economists believe that the provisions adopted by the President are nothing more than "patches" at a time when the economy requires a large monetary aid package.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair continues to grow in the direction of the corrective level of 161.8% (1.3157). The sideways corridor is also clearly visible on the 4-hour chart, as the pair has been trading neatly between the levels of 127.2% and 161.8% for several weeks. Fixing the pair's exchange rate above the Fibo level of 127.2% will significantly increase the probability of further growth of quotes in the direction of the next corrective level of 200.0% (1.3370). The rebound from this level will work in favor of the US dollar and fall in the direction of the lower border of the side corridor.
GBP/USD – Daily.
On the daily chart, the pair's quotes performed an increase to the corrective level of 100.0% (1.3199), however, the level of 161.8% on the 4-hour chart does not allow the quotes to continue the growth process. Closing above the 100.0% level will work in favor of further growth in the direction of the Fibo level of 127.2% (1.3684).
GBP/USD – Weekly.
On the weekly chart, the pound/dollar pair performed an increase to the lower downward trend line. A pullback from this line may allow the pair to perform a reversal in favor of the US dollar and resume the process of falling towards the approximately 1.1500 level. This is a long-term perspective.
Overview of fundamentals:
On Friday, the UK economic news calendar was empty, and in America there were several important reports at once, none of which supported the US currency, which continues to experience serious problems.
News calendar for the US and UK:
On August 17, the information background will be absent, since the calendars of economic events in the UK and the US do not contain anything interesting. Nevertheless, disappointing news regarding the pandemic and the financial aid package may continue to come from America.
COT (Commitments of Traders) report:
The latest COT report on the British pound was absolutely predictable. Large speculators continued to increase long-contracts (+2.5 thousand) in the reporting week and got rid of short-contracts (-8.5 thousand). Thus, the "Non-commercial" group continued to believe in the Briton. The total number of buy positions opened by speculators has been growing for three weeks in a row, and the number of short contracts in their hands has been declining for three weeks in a row. At the same time, the total number of open long and short contracts for all groups of traders is already approximately the same – 171 thousand and 175 thousand.
Forecast for GBP/USD and recommendations to traders:
I recommend selling the pound with the goal of 1,3005, if a new rebound is made from the level of 161.8% (1.3157) on the 4-hour chart. I recommend buying the British currency again if the quotes close above the level of 1.3125 with the goals of 1.3150-1.3200.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency, not for speculative profit, but to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.