FX.co ★ Forecast and trading signals for GBP/USD for March 21. Detailed analysis of the pair's movement and trade deals. The pound is kept from a new fall

GBP/USD 5M

The GBP/USD currency pair tried to start a new round of downward movement on Friday, but came across an insurmountable obstacle in the form of the Kijun-sen line of the Ichimoku indicator. Thus, a rebound followed, which allowed the price to remain within the ascending channel on the hourly TF. Therefore, while the short-term upward trend persists. However, it should be noted right away that this trend is very weak, since the price is also located below the Senkou Span B. Accordingly, so far the pound has not been able to overcome even the Ichimoku cloud on the hourly TF. The British currency's position is still very weak. We have also already said that the absolute majority of factors currently remain on the side of the US currency. Of course, overcoming the Senkou Span B line will open up new opportunities for the bulls, but this line still needs to be overcome. And given the pound's collapse last week immediately after the Bank of England raised the key rate, it is unlikely that traders are set for long-term long positions.

As for trading signals, everything was not easy with them on Friday. On the one hand, we had excellent trend movements, without sharp reversals and frequent pullbacks. On the other hand, it was not possible to catch the movement at the European trading session, since there was simply no sell signal formed. Therefore, we had to wait for the US trading session, when the price came as close as possible to the critical line, but still did not reach it by 5 points. From our point of view, 5 points is enough to consider it a buy signal or a rebound. Nevertheless, it is possible that one of the traders considered it acceptable and opened a long position in this case, it was possible to earn about 65 points, as the price rose to the extreme level of 1.3194.

COT report:

The latest Commitment of Traders (COT) report showed an increase in the bearish mood among commercial traders. However, in general, the mood of the major players has changed too often in recent months, which is clearly seen by the two indicators in the chart above: they are constantly changing the direction of their movement. At the moment, the number of open long positions is less than the number of short positions by almost 30,000. Although two weeks ago their number was almost the same. Earlier, we concluded that major players could not make a decision regarding the British pound, but we also drew attention to the fact that with the complication of the geopolitical situation, the demand for the US currency grew very much, which could "cross out" the data of COT reports. However, now the current picture of what is happening in the foreign exchange market is already beginning to correspond to the COT reports. Thus, the pound may now be at the beginning of a new round of decline. But, since in recent weeks it has only been falling, now another upward correction may follow, and then everything will depend on the geopolitical background. Like the mood of traders, the market situation can change rapidly. A month ago, few people believed that an armed conflict could break out in the center of Europe on a huge territory. Therefore, you need to be prepared for everything, and use COT reports only as an additional factor of assessment and forecasting.

We recommend familiarizing yourself with:

Overview of the EUR/USD pair. March 21. What does the new week have in store for us?

Overview of the GBP/USD pair. March 21. The British pound also feels bad.

Forecast and trading signals for EUR/USD on March 21. Detailed analysis of the movement of the pair and trading transactions.

GBP/USD 1H

An ascending channel has been formed on the hourly timeframe, within which the price is located. It is also located between the Kijun-sen and Senkou Span B lines, so now it is full of obstacles and difficulties on both sides. Consequently, the pound's succeeding growth depends on the bulls' ability to overcome the Senkou Span B line, and the further growth of the US currency depends on the bears' ability to gain a foothold below the channel and the Kijun-sen line. On March 21, we highlight the following important levels: 1.3000, 1.3087, 1.3194, 1.3273. The Senkou Span B (1.3209) and Kijun-sen (1.3105) lines can also be signal sources. Signals can be "bounces" and "breakthroughs" of these levels and lines. It is recommended to set the Stop Loss level to breakeven when the price passes in the right direction by 20 points. The lines of the Ichimoku indicator can move during the day, which should be taken into account when determining trading signals. There are also support and resistance levels on the chart that can be used to take profits on transactions. Federal Reserve Chairman Jerome Powell is set to speak in the US on Monday. Theoretically, it is possible that Powell will make a loud statement that the market will not be able to ignore. But we believe that the probability of this is small. There will be nothing important or interesting in the UK.

Explanations for the chart:

Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.

Support and resistance areas are areas from which the price has repeatedly rebounded off.

Yellow lines are trend lines, trend channels and any other technical patterns.

Indicator 1 on the COT charts is the size of the net position of each category of traders.

Indicator 2 on the COT charts is the size of the net position for the non-commercial group.