FX.co ★ GBP/USD analysis and forecast for August 24, 2021

Today's article on the pound/dollar currency pair will focus on technical analysis and search for opening positions. However, let's start with yesterday's data on the PMI manufacturing activity index and a similar index in the service sector, released in the UK and the US. If this index came out mixed in the United Kingdom (the manufacturing index was better than expected, and the PMI index in the services sector did not meet analysts' forecasts), then both reports from the United States were in the red zone. Now it is difficult to say whether this had a decisive impact on the results of yesterday's trading on GBP/USD, but the fact remains. Today, at 15:00 London time, the index of manufacturing activity from the Federal Reserve Bank of Richmond will be released from the United States. Data on sales of new buildings will also be published.

Daily

At yesterday's trading, the GBP/USD currency pair showed impressive growth and ended Monday's trading at the level of 1.3717. It is still difficult to say whether this is a corrective pullback or a reversal of the course. The only thing that comes to mind is that the movement in the north direction was very strong for the correction. It is also worth noting that the pair has returned above the orange 200 exponential moving average, which makes the breakdown of the 200 EMA be perceived as false. Today's attempts to continue the rise are still being held back by the red Tenkan line of the Ichimoku indicator. However, if the pound bulls manage to pass this line, their next target will be Kijun (at 1.3775). Now, let's talk about the prospects of a likely course reversal. Such a probability exists, and not at all theoretically. As can be seen on the daily chart, the circled three candles represent a reversal model of the "Morning Star" candle analysis. If the market starts working out this model, and this will be expressed in today's growth of GBP/USD, it will be possible to talk not about a correction but a reversal of the quote. Let's wait until it's too early to draw unambiguous conclusions. Any model must find its confirmation. The market must start working on it or ignore the signal.

H1

On the hourly chart, I stretched the grid of the Fibonacci instrument to a decrease of 1.3877-1.3608. As you can see, the pound performed a classic correction to the middle of this movement, after which it shows readiness to return to the downward dynamics. Since the situation for the pound is highly uncertain, and it is not yet clear whether the market will win back the daily candle model "Morning Star," I recommend novice traders to be patient and take a wait-and-see position. It is to stay out of the market. For the rest, I can offer two options for purchases. The first will be possible in the case of a decline to the black 89 EMA and the appearance of bullish Japanese candlesticks there. The second one is provided that if the 200 EMA and the mark of 1.3745 are broken, then after fixing, on a rollback to the zone of 1.3750-1.3745, you can try careful purchases with targets in the area of 1.3775. If the pair rises to the orange 200 EMA and the current highs of 1.3745 and starts drawing bearish candles there, we try to open short positions with targets in the area of 1.3715-1.3700.