FX.co ★ Forecast for GBP/USD on June 16 (COT report).

GBP/USD – 1H.

According to the hourly chart, the quotes of the GBP/USD pair on Tuesday made a successful attempt to get out of the side corridor, in which they spent more than a month. The consolidation under it turned out to be successful. However, the quotes had already returned to the lower border of this corridor by Wednesday morning. Thus, the further fall in the pair's quotes is now again in question. Yesterday in the UK, the information background was quite optimistic, preventing the British from performing a fall. In the morning, reports were released to support the British currency since the unemployment rate fell to 4.7%. Furthermore, the number of applications for unemployment benefits decreased by 92.6 thousand, and the level of average earnings increased by 5.6%. All the data turned out to be better than traders expected, so the growth of the British dollar would be logical.

However, traders were disappointed that the UK extended the quarantine period for another one month. Initially, all restrictions were supposed to be lifted on June 21, but the country has seen an increase in coronavirus diseases in recent weeks. This time, it's the Indian strain, which is considered more contagious than the usual COVID by 60%. Thus, Boris Johnson decided to extend the lightest form of quarantine to have time to vaccinate as many people as possible. It is especially true for doctors, for whom vaccination will now be mandatory, and for the elderly and those in an increased risk group. This morning, it became known that the inflation rate in the country rose to 2.1%, although traders expected to see an acceleration to 1.8%. Against the background of this news, the British pound began to show growth again, although today, it would be more logical for it to fall. Thus, we see that economic data does not always cause the reaction that traders expect.

GBP/USD – 4H.

The GBP/USD pair on the 4-hour chart performed a consolidation under the upward trend corridor. On the one hand, this allows traders to count on the continuation of the fall. On the other hand, the growth process has already resumed today. Thus, the breakdown may be false. In the current situation, I recommend paying more attention to the daily chart, where the quotes perform a fall to the long-term ascending trend line. If there is a close under it, then the chances of the British dollar falling will increase dramatically.

GBP/USD – Daily.

On the daily chart, everything still depends on the trend line, along which the movement of quotes continues. Closing the pair's rate under this line will work in favor of the US dollar and start falling in the direction of the corrective level of 100.0% (1.3513). Until this happens, the growth process can be resumed at any time in the direction of the corrective level of 161.8% (1.4812).

GBP/USD – Weekly.

The pound/dollar pair completed a close over the second downward trend line on the weekly chart. Thus, the chances of long-term growth of the pound remain.

Overview of fundamentals:

On Tuesday, in the UK, there was also a speech by Andrew Bailey, the Governor of the Bank of England, and quite important statistics. But, unfortunately, he did not report anything interesting, and the American statistics in the second half of the day caused the fall of the US dollar.

News calendar for the United States and the United Kingdom:

UK - consumer price index (09:00 UTC).

US - FOMC decision on the main interest rate (18:00 UTC).

US - FOMC accompanying statement (18:00 UTC).

US - FOMC press conference (18:30 UTC).

On Wednesday, the information background promises to be strong. In the morning, the report on British inflation has already been released, and in the evening, the results of the FOMC meeting will be summed up.

COT (Commitments of Traders) report:

The COT report of June 8 on the British pound showed that the mood of the major players has not changed. In total, speculators closed 7,000 long and short contracts during the reporting week. Thus, only the total number of contracts concentrated in the hands of the "Non-commercial" category of traders decreased. Moreover, they also got rid of both types of contracts in the "Commercial" and Non-commercial" categories. It indicates a new drop in interest among traders in the pound. However, the mood of speculators on it remains "bullish," as the number of long contracts exceeds the number of short contracts twice.

GBP/USD forecast and recommendations for traders:

Purchases of the British dollar are not recommended today, as the pair cannot form a rebound from any of the corridor boundaries on several charts. However, it is recommended to sell the pound sterling if the daily chart closes below the ascending trend line with the targets of 1.4008 and 1.3959.

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 for speculative profit, but to support current activities or export-import operations.

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