GBP/USD 5M
The GBP/USD pair was trading in an absolute flat on July 8. Recently, the European currency could boast of movements with volatility of 40 points, but yesterday, the euro showed a fairly good movement in one direction throughout the day. But the pound disappointed market participants, as it was in a range of about 55-60 points wide throughout the day. Moreover, during the day, not a single important report was published in either the UK or the US. There was a report on applications for unemployment benefits in America. The number of primaries for the next week amounted to 373,000, while the forecast was 345,000. The number of secondary ones is now 3.339 million, which practically does not differ from the forecast. However, the markets still did not react in any way to this data. The pound/dollar pair has never even reached an important line or level during the entire day. Thus, traders were deprived of even trading signals for this pair yesterday. On the other hand, trading in an absolute flat is an unrewarding job. Therefore, it may be a good thing that there were no signals. Moreover, several important reports will be published in the UK today, therefore, perhaps, trading might be more active today.
Overview of the EUR/USD pair. July 9. Absolutely bland Fed minutes. The US money supply continues to grow.
Overview of the GBP/USD pair. July 9. The number of diseases in the UK continues to rise. Brexit continues to negatively affect the UK economy.
GBP/USD 1H
The pair is trying to form an upward trend on the hourly timeframe after breaking the downward trend line, but instead, it is on the verge of moving down. At this time, it is still unclear whether the downward movement will resume in the end or not. In recent articles, we have warned traders that movements can be completely illogical. Actually, we have been observing such movements for several days now. The picture is completely incomprehensible, and traders cannot really decide in which direction to trade. The pound has good chances of still falling to the 1.3600-1.3666 area, but so far it cannot do it. In technical terms, we continue to draw your attention to the most important levels and recommend trading from them: 1.3677, 1.3731, 1.3800, 1.3859, 1.3898. Senkou Span B (1.3865) and Kijun-sen (1.3813) lines can also be signal sources. 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. On Friday, the UK will publish quite important reports on GDP for May, as well as on industrial production. Unfortunately, the markets have not paid attention to industrial production for a long time, but maybe this time you will be lucky? By and large, and no one prevents traders from ignoring the GDP report, as was the case last week. There is still a speech by Bank of England Governor Andrew Bailey, but we do not know what he could inform the markets. It is possible that nothing. There are no important events scheduled in the United States.
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 50 points during the last reporting week (June 22-28). However, there is still a feeling that the current decline in the pound is a temporary phenomenon. The Commitment of Traders (COT) report showed different pictures at different times, but the pound still continues to grow in the long term. A group of non-commercial traders closed 35 buy contracts (longs) and opened 454 sell contracts (shorts) during the reporting week. Thus, the net position decreased by 420 contracts. But seriously, you shouldn't even pay attention to these changes, since they are minimal. Nevertheless, the mood of professional traders is still bullish, as the total number of open buy contracts in the Non-commercial group remains 1.5 times greater than the number of sell contracts. Although professional traders for the pound did not buy the British currency at breakneck speed in the last year, nevertheless, the pound has been growing all this time. The first indicator shows that the net position of non-commercial traders (green line) has been falling in recent weeks, but this decline pattern is fundamentally different from a similar line for the euro. If there was a clear trend for the euro and the actions of large players were indeed reflected in the COT charts, then in the case of the pound, the data that reflect the actions of non-commercial traders is very chaotic and does not fit well with how the British currency has been moving in the last year. Actually, the indicators do not even show that the pound was actively bought, although the British currency has sharply grown over the past year and a half. Thus, once again it should be remembered that the pound may rise simply because the money supply in the United States has inflated and continues to swell. Consequently, the dollar depreciates, and as a result, the pound's rate rises.
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.