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GBP/USD – 1H.
Hello, traders! According to the hourly chart, the GBP/USD pair performed two rebounds from the corrective level of 161.8% (1.2432). Each time the price drop was less than the previous one. In the end, I built a "tapering triangle" graphic pattern, which the pair is still inside. Thus, fixing the pair's exchange rate above the "triangle" and the Fibo level of 161.8% will be a strong signal to buy and will significantly increase the probability of further growth of quotes. At the same time, the third rebound from the Fibo level of 161.8% with fixing under the lower line of the "triangle" will work in favor of the US currency and the fall of quotes in the direction of the corrective level of 200.0% (1.2251). I am inclined to implement the first option. But the movement of the pair today in the second half of the day may be strongly influenced by the report on unemployment claims in the US.
GBP/USD – 4H.
As seen on the 4-hour chart, the GBP/USD pair rebounded from the corrective level of 50.0% (1.2303) and started a weak growth process in the direction of the Fibo level of 61.8% (1.2516). However, in general, the movement is more like a sideways movement between the levels of 50.0% and 61.8%. Thus, a more eloquent picture is now on the hourly chart. Signals about rebounds and breakouts of the nearest correction levels on the 4-hour chart can be used as additional or clarifying ones. For example, a close above the corrective level of 61.8% will increase the chances of the continued growth of the British pound. Today, the divergence is not observed in any indicator.
GBP/USD – Daily.
On the daily chart, the picture remains the most interesting. The GBP/USD pair closed above the corrective level of 76.4% (1.2327). Thus, until the quotes are fixed under this Fibo level, the probability of further growth of the pair in the direction of the next corrective level of 61.8% (1.2553) remains high. Closing quotes below the Fibo level of 76.4% will allow traders to count on a reversal in favor of the US currency and a slight drop in quotes in the direction of the corrective level of 100.0% (1.1959).
GBP/USD – Weekly.
On the weekly chart, the pound/dollar pair performed a false breakdown of the lower trend line. Thus, until the pair's quotes are fixed under this line, there is a high probability of growth in the direction of the two upper trend lines.
Overview of fundamentals:
On Wednesday, the UK released only one economic report - on business activity for the manufacturing sector, which was slightly better than expected by traders. Otherwise, the information background was the same as for the euro currency, since most of the news and reports related to America.
The economic calendar for the US and the UK:
UK - PMI for the construction sector (10:30 GMT).
US - number of initial applications for unemployment benefits (14:30 GMT).
Today, April 2, the information background will be important. As I have already said, the report on the number of initial applications for unemployment benefits is extremely important for the US economy, for its future indicators of GDP, production and activity in the service sector. High unemployment and a prolonged epidemic can plunge the American economy into shock and depression.
COT report (Commitments of Traders):
The latest COT report showed a decrease in the total number of short contracts and an increase in long contracts. However, in general, the figures for the ratio of these categories remain almost equal. From the new COT report, which will be released tomorrow, I expect even more balancing between short and long contracts, since neither bulls nor bears had the advantage this week. The pound/dollar pair remains less popular among major market players. The total number of contracts for it is three times lower than for the euro/dollar pair.
Forecast for GBP/USD and recommendations to traders:
The upward trend corridor has released the pair into the wild, however, the pair's growth prospects remain very high. Thus, in order to sell the British, I recommend waiting for the consolidation of quotes under the "triangle" on the hourly chart with the goal of 1.2251. Purchases (more preferable) are recommended to open after fixing above the "triangle" and the Fibo level of 161.8% with a goal of 1.2596.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency to ensure current activities or export-import operations.
"Non-reportable positions" - small traders who do not have a significant impact on the price.
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