FX.co ★ Forecast for GDP/USD on April 15. COT report. US Fed may close stimulus program before rise in interest rates

GBP/USD – 1H.

Hello, dear trader! Yesterday, on the one-hour chart, the pound/dollar pair was trying to avoid levels, which could lead to a downward correction. A day earlier, the pair was hovering between the levels of 1.3728 and 1.3764, and yesterday, it was trading within the range of 1.3764-1.3793. Traders' activity remains low and we cannot see a clear trend. That is why it is really difficult to make forecasts of the pair's movement. The pair may continue trading in the same manner.

On Wednesday, the Fed's Chairman said that the regulator would hardly raise the key interest rate in 2021. He also added that first of all, the regulator would close the asset-purchasing program, and only after that it would consider higher rates. These comments did not clear up the situation. Even before the speech, market participants understood that the regulator would not tighten its monetary policy in the foreseeable future, despite high recovery paces.

Powell did not announce any conditions, which might allow the Fed to switch to a tighter policy. Notably, the US is recovering faster than any other country in the world. However, Jerome Powell emphasizes that the stimulus measures should be taken until the economy shows a full recovery. In general, the rhetoric of Christine Lagarde and Jerome Powell is the same. The main difference is that the US economy is recovering significantly faster that the eurozone one. Such a slowdown is mainly caused by the third coronavirus wave and problems with the vaccination campaign.

GBP/USD – 4H.

On the four-hour chart, the pair fixed below the upward trend line. It means that the market sentiment is bearish. It is better to look at the one-hour chart to monitor the British pound's movement. None of the indicators is showing signs of divergence.

GBP/USD – Daily.

On the daily chart, the pound/dollar pair made an attempt to close below the upward trend line. In this case, it looks like success. Thus, the quote may continue falling towards the 100.0% correctional level of 1.3513.

GBP/USD – Weekly

On the weekly chart, the pound/dollar pair closed above the second downward trend line. Thus, the pound sterling still has a chance for a rise.

News review

On Wednesday, the UK macroeconomic calendar was absolutely empty. Moreover, the speech delivered by Jerome Powell did not influence the British pound.

Macroeconomic calendar for the US and the UK:

US – Retails Sales (12-30 UTC).

US – Unemployment Claims and Continuing Claims (12-30 UTC)

US – Industrial Productions (13-15 UTC)

On Thursday, the UK will not disclose any report. At the same time, the US will publish several reports that may influence the pair.

COT report:

The recent report published on April 6, unveiled that traders avoid opening positions on the British pound. During the week, speculators closed 2,614 long positions and opened 2,120 short trades. Thus, their sentiment became even more bearish. However, the overall situation is almost the same in comparison with the euro. Non-commercial traders opened more long positions than short ones. Thus, the trading sentiment remains bullish. That is why the pound sterling may resume gaining in value.

Outlook for GBP/USD and recommendations for traders:

It is not recommended to buy the British pound as the quote closed below the upward channel on the one-hour chart. The same situation could be seen on bigger time-frames. It is possible to sell the British pound, if the price closes below the 61.85 correctional level of 1.3764 on the one-hour chart with the targets of 1.3728 and 1.3670.

Terminology

"Non-commercial" traders are major market players such as banks, hedge funds, investment funds, private, and large investors.

"Commercial" traders are commercial enterprises, firms, banks, corporations, companies that buy foreign currency not for speculative profit, but to support current activities or export-import operations.

"Non-reportable positions" are small traders who do not have a significant impact on the price.