GBP/USD 5M
The GBP/USD pair was trading quite actively at first on November 11. The fact is that early in the morning several important macroeconomic reports were published in the UK, which provoked a new drop in the British currency's quotes. However, the pound stopped falling, and the pair followed the example of the euro/dollar and began to move exclusively sideways. Since the flat was not obvious for the pound/dollar, it made sense to trade yesterday. However, only one trading signal was formed, also early in the morning. Let's figure out what should have been done on Thursday. As we have already said, there was only one trading signal during the day, and volatility was 71 points. The pair went down by all 71 points after reports on GDP for the third quarter and industrial production for September were published in Britain. Both, if not turned out to be disappointing, then turned out to be weaker than forecasts, so a new fall in the British pound followed. The signal in the form of a fuzzy rebound from the extreme level of 1.3424 should have been worked out, because the rebound itself spoke in favor of a new fall, and also "macroeconomics" spoke in favor of a fall. Subsequently, the price settled below the support level of 1.3381, which made it possible to keep short positions open. However, very soon the consolidation was completed above the level of 1.3381, which served as a signal to close short positions. The profit on the transaction was 25-30 points. We remind you that signals did not form near the support levels (thicker red lines). And since no other line or level was worked out on Thursday, there were no more signals either.
GBP/USD 1H
The pound/dollar pair maintains a downward trend on the hourly timeframe, as it continues to be located below the trend line. At the moment, the pound/dollar pair is very close to its annual lows and does not show any desire to start an upward correction. The price is very far from the trend line, so almost any correction in size will be interpreted as a correction. And because of this, the meaning of the trend line is somewhat lost. However, on the other hand, there is a trend movement itself, and it allows you to trade and open profitable positions. We highlight the following important levels on November 12: 1.3246, 1.3304, 1.3424, 1.3519, 1.3570. The Senkou Span B (1.3618) and Kijun-sen (1.3484) lines can also be signal sources. 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 searching for trading signals. There will be nothing interesting in the UK or the US on Friday. We have already talked about the consumer sentiment index from the University of Michigan. But, unless its value exceeds the forecast (72.5) by 10 points or turns out to be the same number of points worse, it is unlikely that the markets will pay attention to this report at all. Thus, today we expect a calm movement of the pound/dollar pair, possibly a correction, since this week there was a strong downward movement.
We recommend you to familiarize yourself:
Overview of the EUR/USD pair. November 12. US inflation could force the Fed to move faster with monetary tightening.
Overview of the GBP/USD pair. November 12. Great Britain: a trade war with the European Union is just around the corner, a scandal with Boris Johnson.
Forecast and trading signals for GBP/USD for November 12. Detailed analysis of the movement of the pair and trade deals.
COT report
The mood of professional traders practically did not change during the last reporting week (October 26-November 1). However, it should be noted that the two most important days of last week – Wednesday and Thursday - when all the strongest movements occurred, were not included in the latest report. That is, in a week we will be able to see how much and in which direction the mood of professional traders has changed. In the meantime, we can only draw the same conclusions as a week ago. The green and red lines of the first indicator continue to constantly change the direction of movement, constantly intersecting. This suggests that big players themselves do not understand what to do with the pound. However, this can be clearly seen from the very schedule of the pair's movement, starting from July. These four months, the pound/dollar pair has been between the levels of 1.3400 and 1.4000, that is, in the horizontal channel. It was during this period of time that commercial and non-commercial traders changed their mood almost every week. Thus, taking into account the previous changes, we would assume that a new growth of the British currency will begin in the near future with the prospect of a 500-point rise. Moreover, the results of the Bank of England meeting were not dovish. The British currency has fallen undeservedly, which means that the markets may soon recoup this injustice. It should also be noted that during the reporting week, professional traders opened 5.8 buy contracts (longs) and 7.5 thousand sell contracts (shorts). Thus, the net position has not changed much.
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.
