The GBP/USD currency pair continued its entirely predictable and logical upward movement on Wednesday. It is worth recalling that after rebounding from the lower boundaries of the sideways channels on the daily and weekly timeframes (with liquidity being swept as well), the only reasonable expectation was further growth, regardless of the fundamental and macroeconomic backdrop. This is precisely the movement that has been observed for several consecutive weeks. The nearest target at 1.3650 is now only about 150 points away. Today, the Bank of England may provide support for the British currency, as it is almost certain (99% probability) to raise its key interest rate and announce a shift toward monetary policy tightening. As for yesterday, the U.S. elections predictably triggered a decline in the U.S. dollar, as the U.S. Congress will now be occupied with political battles rather than policymaking. The Democrats will block Trump's decisions wherever possible, while Trump will block the Democrats' proposals. In addition, the Democrats will advocate spending cuts, which could negatively affect the growth rate of the U.S. economy. Thus, the market reasonably viewed the Republicans' loss of control as positive for the country, but negative for the economy and the U.S. dollar. Macroeconomic data from the United States had no impact on market sentiment.
From a technical perspective, the British pound continues to form an upward trend, as evidenced by the trendline. On the higher timeframes, the price continues to move from the lower boundaries of the sideways channels toward the upper boundaries. From a technical standpoint, the pound is moving in an entirely logical manner.
On the 5-minute timeframe, two buy signals formed on Wednesday, but by the time they appeared, the upward movement had virtually come to an end. However, the British currency may continue to rise today. Therefore, any new buy signals should be treated with particular attention.
COT Report
COT reports for the British pound show that non-commercial traders have maintained a dominant selling position in the market for several consecutive months. The net position is negative, despite the continuation of the long-term upward trend. Given the developments in the Middle East, it is hardly surprising that demand for the dollar remains relatively high in 2026. The war between the United States and Iran has formally been put on hold, but it could resume in the near future. The Federal Reserve's changed monetary policy stance is also supporting the dollar, while the upward trendline has been broken. However, this break occurred during a sideways market, so the upward trend is not considered complete.
In the long term, the dollar continues to weaken due to Donald Trump's policies, as is clearly visible on the weekly timeframe. The trade war will continue in one form or another for a long time, while Trump's policies are aimed, both directly and indirectly, at weakening the U.S. currency. The long-term upward trend remains intact. According to the latest COT report (dated October 27), the "Non-commercial" group opened 2.4 thousand buy positions and 1.4 thousand sell positions. Thus, the net position of non-commercial traders increased by 1.0 thousand contracts over the week.
GBP/USD Analysis – 1-Hour Chart
On the hourly timeframe, the GBP/USD pair continues to form a logical and predictable upward trend. On the daily and weekly timeframes, the price swept liquidity below the recent lows and remained within the sideways channels. Therefore, further growth in the British currency can be expected, at least toward 1.3650, which represents the upper boundary of the sideways channel on the daily chart. No fundamental or macroeconomic reasons are needed for the British currency to rise, as GBP/USD remains within the sideways channels.
On November 5, the following important levels are identified: 1.3042–1.3050, 1.3096–1.3115, 1.3179–1.3187, 1.3248, 1.3301–1.3309, 1.3369–1.3377, 1.3465–1.3480, 1.3588, and 1.3671–1.3681. The Senkou Span B (1.3358) and Kijun-sen (1.3430) lines may also serve as sources of trading signals. It is recommended to move the Stop Loss to breakeven once the price has moved 20 pips in the favorable direction. The Ichimoku indicator lines may shift throughout the day, which should be taken into account when identifying trading signals.
Today, the Bank of England will announce the results of its meeting in the United Kingdom, although the market already knows what to expect. Despite the fact that the market has had an opportunity to price in monetary policy tightening in advance, the pound is expected to continue rising today. Technical factors remain the primary driver for the British currency, particularly the sideways movement on the higher timeframes.
Summary of the Analysis Above:
Traders may consider the 1.3369–1.3382 level as a target for short positions if the price consolidates below the 1.3465–1.3480 level. Consolidation above the 1.3465–1.3480 level would make it possible to once again consider 1.3588 as a target for long positions.
Explanations for the Illustrations:
Support and resistance price levels – thick red lines around which price movement may end. They are not sources of trading signals.
The Kijun-sen and Senkou Span B lines – Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are considered strong lines.
Extreme levels – thin red lines from which the price has previously rebounded. They are sources of trading signals.
Yellow lines – trendlines, trend channels, and other technical patterns.
Indicator 1 on COT charts – the size of the net position held by each category of traders.
