GBP/USD – 1H.
According to the hourly chart, the GBP/USD pair performed a drop to the corrective level of 38.2% (1.3830) on Tuesday and the corrective level of 38.2% (1.3824) on the small Fibo grid. A rebound from any of these levels will allow traders to count on a reversal in favor of the British currency and some growth towards the levels of 1.3884 and 1.3909. Closing the pair's exchange rate under the Fibo level of 38.2% will increase the probability of a further fall in the direction of the next Fibo level of 50.0% (1.3776). The information background on the British also remains quite weak. There were no economic events in the first two days of the week in the UK and the US. Thus, traders continue to wait for the inflation report, which will be released today, and the report on British GDP, which will be released tomorrow. But at the same time, the fall in quotes continues this week.
Thus, traders are still looking more towards purchases of the US currency. There are few good reasons for the growth of the US currency now, so the growth itself is not very strong. Let me remind you that there are many different important processes in the United States right now, which theoretically can affect the exchange rate of the US currency. The US Congress has passed a bill on infrastructure investments for $ 1 trillion. The debate over this package lasted for several months. The bill eventually received the support of 60 senators. However, now the bill will be sent to the lower house of Congress, where it will also have to pass a vote. This bill may face new revisions in the lower house since many Democrats consider the volume of the package too small. However, most likely, a package of $ 1 trillion will be adopted in the final form. This news and the speeches of several Fed representatives on Monday and Tuesday, whose speeches were dominated by hawkish notes, could help the dollar strengthen these days. But today, a lot will depend on American inflation.
GBP/USD – 4H.
The GBP/USD pair on the 4-hour chart performed a consolidation under the corrective level of 23.6% (1.3870). This closure allows us to count on a further drop in quotes in the direction of 38.2% (1.3829) and 23.6% (1.3729) on the small Fibo grid. The rebound of the pair's quotes from any of these levels will favor the British and the beginning of growth. There are no emerging divergences in any indicator today.
News calendar for the USA and the UK:
US - consumer price index (12:30 UTC).
US - consumer price index excluding food and energy prices (12:30 UTC).
On Wednesday, the calendar of economic events in the UK does not contain a single interesting entry. However, a very important inflation report will be released in the US, which can significantly affect the mood of traders. Thus, the information background today will be at least average in strength.
COT (Commitments of Traders) report:
The latest COT report from August 3 on the British dollar showed that the mood of major players changed to "bullish," as speculators opened 3,370 long contracts and closed 3,735 short contracts in the reporting week. Thus, the total number of long contracts on their hands again exceeds the total number of short contracts. Such a change in the mood of the "Non-commercial" category of traders may mean that major players are not ready for further sales of the British dollar. If so, then the British currency may begin to be in demand again among speculators. I also want to note that the total number of long and short contracts for all traders is now almost the same. Therefore, bull traders still do not have a strong advantage yet.
GBP/USD forecast and recommendations for traders:
Today, I recommend buying the pair if there is a rebound from the level of 1.3824 on the hourly chart with a target of 1.3884. It was recommended to sell the pound on the hourly chart with a target of 1.3830. This level has been reached. New sales are possible when closing below the level of 1.3824 with a target of 1.3776.
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 ensure current activities or export-import operations.
"Non-reportable positions" are small traders who do not have a significant impact on the price.
