GBP/USD: the plan for the American session on November 3 (analysis of morning deals). The pound collapsed even before the Bank of England's decision

In my morning forecast, I paid attention to the 1.1380 level and recommended deciding on entering the market there. Let's look at the 5-minute chart and figure out what happened. The bears did not keep waiting long and continued actively selling the pound. The breakthrough of 1.1380 took place without a reverse test, so I failed to enter short positions there and from 1.1307. In the afternoon, the technical picture was completely revised.

To open long positions on GBP/USD, you need the following:

It is difficult to say what the Bank of England should do to influence the situation somehow. Whatever decisions the regulator resorted to today, it is unlikely that the bulls will be able to buy off the morning fall. In the afternoon, I advise you to wait for Andrew Bailey's statement and only then look for convenient entry points into the market. I told you more about what the central bank governor can say in the morning forecast. In case of further fall of the pair, only a false breakdown in the area of 1.1210 will give a buy signal with a return to the resistance of 1.1276 formed by the results of European trading. Practically nothing depends on this area, so bulls can easily get above this range. A breakdown of 1.1276 and a reverse test from top to bottom will open the way to 1.1341. You can reach the resistance of 1.1416, where the moving averages are playing on the sellers' side. It will become more difficult for buyers to control the market there. A more distant target will be the 1.1489 area, which will lead to a fairly large capitulation of sellers - I recommend fixing profits there. If GBP/USD falls and there are no buyers at 1.1210, we may reach another low of 1.1137. Therefore, do not rush to enter the market. Only a false breakdown at 1.1137 will ensure the presence of major players. It is possible to open long positions on GBP/USD immediately for a rebound from 1.1066, or around the minimum of 1.1013, with the aim of correction of 30-35 points within a day.

To open short positions on GBP/USD, you need the following:

Bears keep everything under their control, which can only strengthen after the data is scheduled for the afternoon. Reports are expected on the number of initial applications for unemployment benefits and the balance of the US foreign trade balance. But much more important will be ISM's index of business activity in the service sector. If it grows, the pressure on the pound will likely only increase. At the moment, sellers need to defend the resistance of 1.1276 with all their might, where a false breakdown against the background of weak US statistics will give a sell signal based on the return of pressure on the pound and its downward movement to the next support of 1.1210. A breakout and a reverse test from the bottom up of this range will already give an entry point for sale with an update of the minimum of 1.1137. A more distant target will be the 1.1066 area, where I recommend fixing profits. The market will remain balanced with the option of GBP/USD growth and the absence of bears at 1.1276 in the afternoon. In this case, it will be possible to count on an upward movement to the maximum of 1.1341. Only a false breakout at this level forms an entry point into short positions in the expectation of a new downward movement of the pair. If there is no activity there, there may be a jerk up to the maximum of 1.1316, where I advise you to sell GBP/USD immediately for a rebound, counting on the pair moving down by 30-35 points inside the day.

Signals of indicators:

Moving Averages

Trading is conducted below the 30 and 50-day moving averages, indicating a bear market's development.

Note: The author considers the period and prices of moving averages on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Description of indicators