30.09.202013:22 Forex Analysis & Reviews: GBP/USD: plan for the American session on September 30

To open long positions on GBP/USD, you need:

In my morning forecast, I paid attention to sales below the level of 1.2834, however, the desire of the bears is clearly not enough to resume the bearish trend. On the 5-minute chart, the sellers are trying to break through the support of 1.2834, however, the bulls quickly return the pair to this level, thereby preventing the formation of a good entry point into the sale.

At the moment, the technical picture has shifted slightly, however, trading is conducted in a side channel. I specifically changed the first resistance level, moving it a little closer so that we can get a good entry point into long positions in the afternoon. A break and consolidation above the resistance of 1.2869 will form a good signal to buy the pound in order to update the weekly maximum in the area of 1.2925, where I recommend taking the profits. However, the longer-term task of sellers will be to test the maximum of 1.2995. It is worth noting that as long as trading is conducted above the range of 1.2819, the pound's growth option will remain. If this range breaks in the second half of the day, I recommend that you postpone long positions until the test of the minimum of 1.2754 and buy GBP/USD there immediately for a rebound in the expectation of correction of 30-40 points within the day.

To open short positions on GBP/USD, you need:

Sellers have tried to quickly regain control of the market, however, they failed. Thus, the tasks for the second half of the day remained the same. First, they need to achieve a breakthrough and consolidate below the new support of 1.2819. A test of this level on the reverse side forms a good entry point into short positions, which will quickly extinguish the optimism of buyers that will lead to an update of the first support level of 1.2754, where I recommend fixing the profits. A longer-term target will be the area of 1.2689, the test of which will mean the resumption of the bearish trend for the pound. The formation of a false breakout in the resistance area of 1.2869, with the growth of GBP/USD in the second half of the day, will also be a signal to open short positions in the pair. However, if there is no activity on the part of the bears, it is best to postpone sales until the test of a larger maximum of 1.2925 or sell the pound immediately on the rebound from the resistance of 1.2995 with the aim of correction of 30-40 points within the day.

Let me remind you that the COT reports (Commitment of Traders) for September 22 did not record any serious changes in the market, as everyone took a wait-and-see position and is watching how the economy will react to the next phase of growth in the incidence of COVID-19 and how the situation around Brexit will develop further. Most likely, the pressure on the pound will gradually return as the second wave of coronavirus spreads and the negotiations on the UK's trade agreement with the EU become more complicated, where there is not even a hint of reaching a compromise between the parties. During the reporting week, there was a minimal reduction in short non-commercial positions from the level of 41,508 to the level of 40,523. Long non-profit positions also fell from 43,801 to 43,487. As a result, the non-commercial net position remained virtually unchanged at 2,964, compared to 2,293 a week earlier.

Signals of indicators:

Moving averages

Trading is conducted in the area of 30 and 50 daily averages, which indicates a gradual loss of advantage by buyers over the market situation.

Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.

Bollinger Bands

A break in the lower limit of the indicator around 1.2819 will increase the pressure on the pound. A break of the upper limit of the indicator in the area of 1.2870 will lead to a new wave of growth of the pair.

Description of indicators

• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
• MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-profit speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between short and long positions of non-commercial traders.