In my morning forecast, I paid attention to the level of 1.1706 and recommended making decisions on entering the market. Let's look at the 5-minute chart and figure out what happened. As a result of the breakout of 1.1706 and the reverse test from top to bottom, several good entry points into long positions were formed in the continuation of the bull market development. At the time of writing, the pair had already gone up more than 25 points, and demand was only increasing. But, despite this, the technical picture was revised for the second half of the day, as we were waiting for important statistics on the United States.
To open long positions on GBP/USD, you need:
Data on the UK labor market managed to support buyers of the pound, as the unemployment rate fell and household incomes turned out to be better than economists' forecasts. Now the whole focus will be on inflation in the US and the pace of its decline: many expect prices to decline for the second month, and in August, annual growth will be about 8.1%. A larger reduction in inflation will certainly be met by purchases of the British pound further along the upward trend, as demand for risky assets will return. In case of a decline in GBP/USD after the data, I advise you to pay attention to the new support at 1.1692, formed at the end of the first half of the day and coinciding with the moving averages, playing on the side of the bulls. I advise you to open long positions from there only when a false breakdown is formed. If this scenario is implemented, we can count on continued growth and an update of the weekly maximum in the area of 1.1757. A breakdown and a reverse test from the top down of this range will help strengthen buyers' confidence, opening the road to 1.1793. A more distant goal will be a maximum of 1.1838, where I recommend fixing the profits. If GBP/USD falls and there are no buyers at 1.1692, the pressure on the pair will only increase, as this will pull the stop orders of the morning bulls. Below 1.1692, only the 1.1651 area is visible, where the lower boundary of the ascending price channel from September 7 passes. I recommend opening long positions only when a false breakdown is formed. You can buy GBP/USD immediately on a rebound from 1.1602, or even lower - from 1.1551 with the aim of correction of 30-35 points within a day.
To open short positions on GBP/USD, you need:
The pound's fall will depend entirely on the United States' inflation data. However, the pound sellers can also rely on the nearest resistance of 1.1757, the protection of which is now their main priority. Of course, the optimal scenario would be to sell at a false breakdown from this level, which would surely then dump GBP/USD in the area of the nearest support of 1.1692, formed during the European session. A breakout and a reverse test from the bottom up of 1.1692 will lead to an excellent sell signal to collapse to 1.1651, where I recommend fixing the profits. A more distant target will be the 1.1602 area. With the option of GBP/USD growth and the absence of bears at 1.1787, and I consider this option the main one, the bulls will have a chance to develop a further upward trend. In this case, I advise you not to rush with sales: only a false breakdown in the area of a new high of 1.1793 forms a sell signal. It is possible to sell GBP/USD immediately on a rebound from the level of 1.1838, or even higher – around 1.1899, intending to move down by 30-35 points within the day.
Signals of indicators:
Moving Averages
Trading is conducted above the 30 and 50-day moving averages, which indicates an uptrend.
Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger Bands
In the event of a decline, the lower limit of the indicator around 1.1660 will act as support.
Description of indicators
Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.MACD indicator (Moving Average Convergence / Divergence - moving average convergence/divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9Bollinger Bands (Bollinger Bands). Period 20Non-profit speculative traders, such as individual traders, hedge funds, and large institutions use the futures market for speculative purposes and to meet certain requirements.Long non-commercial positions represent the total long open position of non-commercial traders.Short non-commercial positions represent the total short open position of non-commercial traders.Total non-commercial net position is the difference between the short and long positions of non-commercial traders.