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GBP/USD – 1H.
According to the hourly chart, the GBP/USD pair fell to 1.3600 on Tuesday. The rebound of quotes from this level worked in favor of the British pound, and the pair began to grow in the direction of the corrective level of 127.2% (1.3679). The consolidation of quotes under the level of 1.3600 will favor the US currency and the resumption of the fall in the direction of the Fibo level of 161.8% (1.3524). There is no information background for the pound/dollar pair at this time. In the first three working days of this week, there was no news and reports.
Nevertheless, during these three days, the British dollar fell by more than 200 points. There has not been such a strong movement for a long time. What is the reason? There can be only one reason in the current situation. Traders are actively selling the pound, as they disapprove of the actions of the British authorities, who this Monday canceled all quarantine measures against the background of the growing number of sick Britons.
In the last three days, for which there are statistics, the number of cases in Britain was 54,000, 47,000, and 40,000 people. On the one hand, it seems that the virus is beginning to recede. On the other - perhaps this is a temporary decline. In any case, the number of infected people is very high. One of the highest in the world at the moment. Thus, it would be more logical to expect the British government to strengthen the quarantine and introduce additional restrictions in such circumstances. But Boris Johnson and his colleagues believe that now is the best time to open the economy. It is noteworthy that many countries worldwide have just closed air and passenger traffic with Britain or do not recommend it for visiting. Thus, Britain may have opened its economy, but many countries have closed their own in relation to the British. Anyway, the problem with the fourth wave should be solved as soon as possible.
GBP/USD – 4H.
The GBP/USD pair on the 4-hour chart performed a consolidation under the corrective level of 38.2% (1.3642). Thus, the fall of the pair's exchange rate can now be continued in the direction of the next corrective level of 50.0% (1.3457). Fixing the quotes above the level of 38.2% will favor the British and the beginning of new growth in the direction of the corrective level of 23.6% (1.3870). There are no emerging divergences in any indicator today.
Overview of fundamentals:
On Tuesday, the calendar of economic events in the UK was empty, and there was no important news in the US either. Thus, the information background did not have any impact on traders.
News calendar for the United States and the United Kingdom:
On Wednesday, the calendars of economic events in the United Kingdom and the United States are again empty. Thus, the information background will still be absent today. Nevertheless, the news about the spread of the virus in Britain may continue to cause quite strong activity of traders on the sales of the British.
COT (Commitments of Traders) report:
The latest COT report on July 13 for the British showed that the mood of major players is again becoming more "bearish." During the reporting week, speculators increased 1,729 short contracts and got rid of 8,054 long contracts. Thus, the "bullish" mood of the "Non-commercial" category of traders has weakened again. Over the past four weeks, both for the euro and for the pound, the mood of traders has become more "bearish." However, the changes in the British are still less pronounced. However, it is for the British that the number of long and short contracts in the hands of speculators is already almost the same. Thus, it is already possible to talk about the lack of an advantage for bull traders.
Forecast for GBP/USD and recommendations to traders:
I recommend new purchases of the British with a target of 1.3679 if the pair performs a rebound from the level of 1.3600 on the hourly chart. It was recommended to sell the pound if a close is made under the level of 1.3642 on the 4-hour chart with targets of 1.3600 and 1.3524. Now you need to stay in these deals or wait for the closing under the level of 1.3600 and open new ones.
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 ensure current activities or export-import operations.
"Non-reportable positions" are small traders who do not have a significant impact on the price.
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