GBP/USD – 1H.
According to the hourly chart, the GBP/USD pair performed a reversal in favor of the British currency on Thursday and began a fairly strong growth, which led to a close above the levels of 50.0% (1.3792) and 38.2% (1.3830) on both Fibo grids. Thus, the growth process can be continued toward the next corrective level of 76.4% (1.3892). Fixing the pair's exchange rate below the level of 1.3830 will favor the US currency and the resumption of the fall in the direction of the level of 1.3792. There was no information background for the pound yesterday. Traders did not appreciate the news about a possible tax increase in the UK and ignored the growing likelihood of a referendum on Scottish independence. Thus, the British relative to the American continues to be located very high and showed an increase in the last day and a half.
There will be important economic reports in the UK today. If traders do not ignore them, the British dollar's rate on Friday will depend entirely on them. The most important is the GDP report for July. Traders expect the British economy to grow by 8.5% by the end of July compared to July 2020. It is also expected to increase by 4% in three-month terms. In addition, a report on industrial production for the same July will be released, where traders expect an increase of 0.5% m/m. Thus, these two reports will determine the dynamics of the pair today. Strong data may help the British dollar move even higher to the level of 1.3892. At the same time, in the United States today, the calendar of economic events is almost empty. Therefore, all the most interesting things for traders will happen in the first half of the day or the next half hour. Other important topics of an informational nature are now very difficult to compare with the behavior of the pound/dollar pair. I recommend paying more attention to important levels and not to the general information background of a non-economic nature.
GBP/USD – 4H.
The GBP/USD pair on the 4-hour chart performed a rebound from the Fibo level of 38.2% and a reversal in favor of the pound. As a result, the pair's quotes performed a return to the corrective level of 23.6% (1.3870), from which the last time there was a rebound. A new rebound will again work in favor of the US currency, and some fall, the goals of which are better determined by the hourly chart. Closing the pair's exchange rate above the level of 1.3870 will significantly increase the probability of continuing growth in the direction of the level of 100.0% (1.3981). There are no emerging divergences in any indicator today.
News calendar for the USA and the UK:
UK - change in GDP (06:00 UTC).
UK - change in the volume of industrial production (06:00 UTC).
US - producer price index (12:30 UTC).
On Friday, the calendar of economic events in the UK contains several interesting entries. However, in the US, there are practically none. Therefore, all the most interesting things will happen in the early morning. The information background will be of average strength today.
COT (Commitments of Traders) report:
The latest COT report from August 31 showed that the mood of the major players has become more "bullish." During the reporting week, speculators closed 2,467 long contracts and 4,809 short contracts. However, the total number of long contracts in the hands of speculators is still less than the total number of short contracts. Therefore, in general, the mood of speculators is now "bearish." However, traders still have big problems with closing at 1.3600, and at this time, the growth of the British dollar quotes continues. Thus, the further fall of the pound is not guaranteed. We need graphical sell signals so that they coincide with the data of COT reports.
GBP/USD forecast and recommendations for traders:
Yesterday, I recommended buying the pair if there is a rebound from the 1.3747 or 1.3731 on the hourly chart. However, another buy signal was formed – closing above the corridor and the level of 1.3792. Now you should keep open purchases with a target of 1.3892. I recommend new sales of the pound with targets of 1.3792 and 1.3747 if a close is made under the level of 1.3830 on the hourly chart.
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.
