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GBP/USD – 1H.
According to the hourly chart, the quotes of the GBP/USD pair rebounded from the corrective level of 76.4% (1.3728), a reversal in favor of the British dollar and an increase to the Fibo level of 127.2% (1.3986). The non-stop growth of the British dollar has been going on for two days and at the moment the quotes have completed the closing above the level of 127.2%. Thus, despite the 300 points passed up, the pair can continue the growth process in the direction of the next Fibo level of 161.8% (1.4072). In the review of the euro/dollar, I raised the question of what happened on Monday that the quotes of the US currency collapsed? Looking at what is happening on the pound/dollar pair, the same question wants to be repeated with twice as much expression. Traders do not pay any attention to economic reports (which simply do not exist and have not been in recent days), economic events, or the general background. The dollar is unlikely to fall because the Fed refuses to raise rates or scale back its quantitative easing program. It's not just the Fed that refuses to do this in the coming months and even years. The world economy is just beginning to recover from a severe crisis, and in many countries of the world, it is not even complete. So to blame the Fed for refusing to tighten monetary policy is unwise. Rising inflation? So this is exactly what the Fed has been trying to achieve for years! This, of course, is a negative moment for the economy, but the corresponding report was released in the middle of last week and the reaction of traders at that time was a drop in the dollar by 40-50 points. Why would traders suddenly remember that report at the beginning of a new week and sell the American? In general, non-obvious processes are taking place on the market now, so it is best to pay attention to graphical analysis.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair increased to the level of 1.4003. The rebound of quotes from this level will allow traders to expect a reversal in favor of the US currency and a slight drop in the direction of the corrective level of 23.6% (1.3870). Fixing the pair's rate above the level of 1.4003 will work in favor of continuing growth in the direction of the next Fibo level of 0.0% (1.4240).
GBP/USD – Daily.
On the daily chart, the pair's quotes resumed the growth process in the direction of the corrective level of 127.2% (1.4084), and the ascending trend line received a new point, through which it now passes. The new closing of quotes under the trend line will allow you to count on a strong drop in British quotes.
GBP/USD – Weekly.
On the weekly chart, the pound/dollar pair completed a close over the second downward trend line. Thus, the chances of long-term growth of the pound remain.
Overview of fundamentals:
On Monday, the UK and US economic news calendars were again empty.
News calendar for the United States and the United Kingdom:
UK - change in the number of applications for unemployment benefits (06:00 UTC).
UK - unemployment rate (06:00 UTC).
UK - change in the level of average earnings (06:00 UTC).
On Tuesday, some fairly important reports will be released in the UK. Thus, from the very morning, the information background will have an impact on the pair. Another question is whether we will notice this effect on the charts, given the strong growth of quotes?
COT (Commitments of Traders) report:
The latest COT report of April 13 on the Briton was very eloquent. The "Non-commercial" category of traders opened as many as 7,227 new long contracts, which is a lot for the pound. Speculators also opened 930 short contracts. Thus, the mood of the most important category of traders has sharply become more bullish. Now the number of long contracts in the "Non-commercial" category again exceeds twice the number of short contracts. This means that in general, the bullish mood among speculators remains, and the pound can continue the growth process. That's exactly what he's been doing in the last few days.
GBP/USD forecast and recommendations for traders:
I recommend buying the British dollar with a target of 0.0% (1.4240) if a close above the level of 1.4003 is made on the 4-hour chart. I recommend selling the pound if there is a rebound from the level of 1.4003 with a target of 1.3870 on the 4-hour chart.
Terms:
"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.
"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy foreign currency, not for speculative profit, but to support 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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