GBP/USD – 1H.
According to the hourly chart, the GBP/USD pair has performed an increase to the downward trend line and is currently rebounding from it. Thus, the process of falling quotes can be resumed in the direction of the corrective level of 127.2% (1.3517), if a close is made under the Fibo level of 100.0% (1.3601). The consolidation of the pair's quotes above the trend line will work in favor of the British and the continuation of growth in the direction of the next levels of 1.3674 and 1.3720. After five fairly active trading days, traders were trading much less actively yesterday. It is clear that they have already stopped worrying about the fuel crisis in the UK, and this topic has already faded into the background. But no one has come to the fore yet. There hasn't been a lot of news and economic reports in the UK lately. Yesterday, for example, there was only an index of business activity for the service sector, which did not affect the mood of traders.
As for the most important and expected ISM index, traders responded to it by buying the dollar, which allowed it to grow by 10-15 points, no more. Thus, the graphic picture is more important for the pound now. And the graphic picture now speaks in favor of preserving the "bearish" mood among traders. However, it also allows for its change to "bullish". I would like to say something like "today everything can be decided", but it is not so. For today, neither in the UK nor in the USA are such events and reports planned that could "solve everything" for the pound/dollar pair. More important now are the topics of disrupted supply chains in the UK, as well as the lack of mutual understanding between Democrats and Republicans, which can cost America dearly. However, even on these important topics, traders do not pay much attention. In the last week, the pound traded exclusively on news from Britain about a serious fuel shortage. However, this topic no longer affects the course. Thus, no matter how banal it may sound, we are now waiting for graphical signals.
GBP/USD - 4H.
The GBP/USD pair on the 4-hour chart performed an increase to the corrective level of 38.2% (1.3642), rebound from it, and a reversal in favor of the US currency. A bearish divergence has also formed in the MACD indicator, which increases the likelihood of a further drop in quotes in the direction of the corrective level of 50.0% (1.3457). Closing the pair's rate above the level of 1.3642 will work in favor of continuing growth towards the next corrective level of 23.6% (1.3870).
News calendar for the USA and the UK:
UK - PMI index for the construction sector (08:30 UTC).
US - change in the number of employees from ADP (12:15 UTC).
US - FOMC member Rafael Bostic will deliver a speech (13:00 UTC).
On Wednesday, the calendars of economic events in the US and the UK contain only one important report for two – the ADP report. However, as I have already said, this report may not attract the attention of traders who are not interested in economic events at all right now.
COT (Commitments of Traders) report:
The latest COT report from September 28 on the pound showed that the mood of the major players has become a little more "bullish". In the reporting week, speculators opened 5,412 long contracts and 4,577 short contracts. So the difference is not too big. In general, there is almost complete equality in the number of open long and short contracts for all categories of traders. It means that the mood of speculators is now as neutral as possible. Nevertheless, in recent months, the mood of the "non-commercial" category has only become more "bearish". Thus, there is a trend that suggests a further decline in the British dollar.
GBP/USD forecast and recommendations to traders:
I recommend buying the pound when closing quotes above the level of 1.3642 on the 4-hour chart with a target of 1.3720. I recommended opening sales yesterday, as the quotes performed a rebound from the level of 1.3642 on the 4-hour chart, with a target of 1.3517. Now, these deals can be kept open.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency not to make speculative profits, but to ensure current activities or export-import operations.
"Non-reportable positions" are small traders who do not have a significant impact on the price.