GBP/USD – 1H.
According to the hourly chart, the quotes of the GBP/USD pair made a new reversal in favor of the US currency. Thus, the fall of quotes can be continued in the direction of the corrective levels of 61.8% (1.3216) and 76.4% (1.3154). However, I recommend looking for signals on the higher charts at this time. The information background for the pound this week is either missing or poor. New information has been received from the negotiation process between the British and European groups. The information is exactly the same as before. Michel Barnier said that there is still no progress, and London is absolutely not eager to give in and generally meet halfway. In contrast, the UK's chief diplomat, David Frost, said the talks were useful, however, he also noted that there was no progress. Thus, the chances that London and Brussels will reach an agreement continue to fade before our eyes. By the way, traders have already stopped paying attention to the news from the negotiation process. Because the weekly message that "there is no progress" is not news. Thus, other more important factors continue to influence the pound and the dollar. At this time, I believe that bull traders have retreated from the market, so the dollar began to rise. Economic reports from America this afternoon will show if there is any improvement in the US economy.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair rebounded from the upper border of the upward trend corridor and a reversal in favor of the US currency. Thus, the fall continues in the direction of the lower border of the upward trend corridor, which continues to characterize the current mood of traders as "bullish". The pair's rebound from the lower border of the corridor will work in favor of the British currency and resume growth towards the level of 200.0% (1.3373). Closing the pair's rate under the corridor will increase the probability of a further fall towards the level of 127.2% (1.2964).
GBP/USD – Daily.
On the daily chart, the pair's quotes maintain the probability of continuing the growth process in the direction of the corrective level of 127.2% (1.3684), as they continue to remain above the Fibo level of 100.0% (1.3199). Closing quotes below this level will work in favor of the US currency and start falling towards the level of 76.4% (1.2776).
GBP/USD – Weekly.
On the weekly chart, the pound/dollar pair closed above the lower downward trend line. Thus, the growth process can now be continued in the direction of the second downward trend line, fixing above which will further increase the probability of further growth of the British dollar.
Overview of fundamentals:
On Thursday, the UK released the index of business activity for the service sector, which was almost unchanged compared to last month. American statistics also did not have much impact on trading on Thursday.
News calendar for the United States and the United Kingdom:
UK - PMI for the construction sector (08:30 GMT).
US - unemployment rate (12:30 GMT).
US - change in the number of people employed in the non-agricultural sector (12:30 GMT).
US - change in average hourly earnings (12:30 GMT).
On September 4, the UK will release a report on the PMI for the construction sector, and in America - three important reports that are not recommended to skip.
COT (Commitments of Traders) report:
The latest COT report on the British dollar showed a sharp drop in interest among speculators in this currency. A Group of non-commercial traders cut both long and short contracts in equal amounts during the reporting week. Thus, despite the fact that the number of contracts focused on their hands has decreased by 19 thousand, the mood among major traders has not changed, that is, it has not become more "bearish". Thus, according to the COT report, there are still no prerequisites for the end of the upward trend. The reduction in the number of contracts for both the "Non-commercial" group and all groups of traders combined did not affect the pair's volatility in any way.
Forecast for GBP/USD and recommendations for traders:
I recommend selling the British currency with a target of 1.3100, if the quotes are fixed under the ascending corridor on the 4-hour chart. Purchases of the British dollar can be opened if there is a rebound from the lower border of the ascending corridor on the 4-hour chart with the goal of 1.3373.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency, not for speculative profit, but to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
