In my morning forecast, I paid attention to the 1.2643 level and planned to decide to enter the market from it. Let's look at the 5-minute chart and figure out what happened there. The decline and the formation of a false breakdown there gave a buy signal, but after moving up by 15 points, demand for the pound decreased. In the afternoon, the technical picture was not revised, as the main disassembly for the 1.2643 level has not yet occurred.
To open long positions on GBP/USD, you need:
The lack of data for the UK led to the pair's return to the area of yesterday's low, for which, most likely, the main struggle will continue. Given the empty economic calendar for the second half of the day, I will act according to the morning plan: I plan to buy the pound only after protecting the support of 1.2643, similar to what I discussed above. A decrease and the formation of a false breakdown will give an entry point into long positions that can bring the pound back to the area of 1.2671, where the moving averages are already located. Only a rush and a top-down test of this range is a chance for GBP/USD growth with an update of 1.2698 – month high. In the case of an exit above this range, we can talk about a breakthrough to 1.2734, where I will fix profits. In the scenario of GBP/USD falling and no buyers at 1.2643 in the afternoon, the pressure on the pound will increase, leading to a downward movement to the area of 1.2615. Forming a false breakdown will be a suitable option for entering the market. Opening long positions on GBP/USD immediately on a rebound from 1.2583 to correct 30-35 points within a day is possible.
To open short positions on GBP/USD, you need:
In case of a bullish reaction to the data in the afternoon, I will act in the resistance area of 1.2671, which I failed to reach during the European session. The formation of a false breakout there will lead to an excellent entry point into short positions to further reduce GBP/USD to the area of 1.2643. However, a breakout and a reverse test from the bottom up of this range will increase the pressure on the pair, giving the bears an advantage and another entry point to sell to update 1.2615. A real struggle will unfold for this level. A further target will be a minimum of 1.2583, negating all buyers' efforts this week. I will fix the profit there. With the option of GBP/USD growth and the absence of bears at 1.2671 in the afternoon, buyers will have the opportunity for an upward correction at the end of the week and an update to the level of 1.2698. I will also serve there only on a false breakdown. Without activity there, I advise you to open short positions on GBP/USD from 1.2734, counting on the pair's rebound down by 30-35 points within the day.
Indicator signals:
Moving averages
Trading is conducted below the 30 and 50-day moving averages, indicating further decline in the pair.
Note: The author considers the period and prices of the moving averages on the hourly H1 chart, which differs from the general definition of classic daily moving averages on the D1 daily chart.
Bollinger Bands
In case of a decline, the lower boundary of the indicator, around 1.2643, will act as support.
Description of indicators:
Moving average (MA): Determines the current trend by smoothing volatility and noise. Period 50. Marked in yellow on the chart.Moving average (MA): Determines the current trend by smoothing volatility and noise. Period 30. Marked in green on the chart.MACD (Moving Average Convergence/Divergence): Fast EMA period 12. Slow EMA period 26. SMA period 9.Bollinger Bands: Period 20.Non-commercial traders: Speculators such as individual traders, hedge funds, and large institutions using the futures market for speculative purposes and meeting 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: The difference between short and long positions of non-commercial traders.