GBP/USD 5M
The GBP/USD currency pair did not move as well on Monday as it did on previous days and for once did not renew its 37-year lows. Remember, we said that these lows will be updated more than once? At the moment, the "bottom" is the level of 1.1354, but the pair cannot move at least 300-400 points even from it. Two meetings of central banks will take place this week, which, of course, will leave a mark on the charts of currency pairs in which there is a pound and a dollar. However, will this help the British pound or is it in for a new collapse? There were no macroeconomic statistics or "foundations" either in America or Great Britain on Monday. However, even in this scenario, the bears almost managed to overcome the level of 1.1354. The pound's positions remain very weak, one can hope for the Bank of England and a rate hike, but...
In regards to Monday's trading signals, it was rather scarce. The first sell signal was formed at night, when the price overcame the level of 1.1411. At the opening of the European trading session, the pair moved away from the point where the signal was formed by only a few points, so a position could be opened. As of Monday, there was no level below the level of 1.1411, so the position should have been closed manually right away. Or near the previous day's low. It was quite possible to earn about 30 points on it. The next signal was formed on a new bounce from the 1.1411 level, but this signal was rather late and should have been ignored.
COT report:
The latest Commitment of Traders (COT) report on the British pound was again very eloquent. During the week, the non-commercial group closed 11,600 long positions and opened 6,000 shorts. Thus, the net position of non-commercial traders decreased by another 17,600, which is a lot for the pound. The net position indicator has been growing for several months, but the mood of the big players still remains "pronounced bearish", which is clearly seen in the second indicator in the chart above (purple bars below zero = bearish mood). And now it has begun a new fall, so the British pound still cannot count on a strong growth. How can you count on it if the market sells the pound more than it buys? And now its decline has completely resumed and multi-year lows are updated almost every day, so the bearish mood of major players in the near future can only intensify. The non-commercial group now has a total of 109,000 shorts and 41,000 longs open. The difference is again almost threefold. The net position will have to show growth for a long time to at least equalize these figures. Moreover, one should not forget about the high demand for the US dollar, which also plays a role in the fall of the pound/dollar pair.
We recommend to familiarize yourself with:
Overview of the EUR/USD pair. September 20. No news, markets are waiting for the Fed meeting.
Overview of the GBP/USD pair. September 20. The British pound is unwilling to react to a future rate hike by the Bank of England.
Forecast and trading signals for EUR/USD on September 20. Detailed analysis of the movement of the pair and trading transactions.
GBP/USD 1H
On the hourly timeframe, the pound/dollar pair was in a downward movement all last week, and now it maintains this trend. A new local low at 1.1354, and the price is very close to it, so now there is no question of even a correction. Of course, this week the situation may be greatly aggravated or turned upside down, but it will not be possible to judge this until Friday. We highlight the following important levels on September 20: 1.1354, 1.1442, 1.1649, 1.1760, 1.1874. The Senkou Span B (1.1569) and Kijun-sen (1.1543) lines can also be sources of signals. Signals can be "rebounds" and "breakthroughs" of these levels and lines. The Stop Loss level is recommended to be set to breakeven when the price passes in the right direction by 20 points. Ichimoku indicator lines can move during the day, which should be taken into account when determining trading signals. The chart also contains support and resistance levels that can be used to take profits on trades. There will be no interesting events in either the UK or the US on Tuesday. However, we remind you that this week there will be meetings of the Bank of England and the Federal Reserve, so volatility is unlikely to be low these days. Monday was rather weak, but already Tuesday could be much more volatile.
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.
