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11.12.202010:15 Forex Analysis & Reviews: GBP/USD. December 11. COT report. No deal – no growth. The Briton is finally starting to react to the failed negotiations once again

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GBP/USD – 1H.

Exchange Rates 11.12.2020 analysis

According to the hourly chart, the quotes of the GBP/USD pair performed a new fall to the corrective level of 127.2% (1.3264), rebound from it, and minimal growth. However, at the moment, a new fall to this level is planned, which may end with a close below it, which will allow traders to count on the continuation of the fall in quotes in the direction of the next Fibo level of 100.0% (1.3176). Negotiations between Ursula von der Leyen and Boris Johnson did not end. However, few traders seriously expected that the head of the European Commission and the British Prime Minister would be able to break the deadlock in a few hours if the delegations of Michel Barnier and David Frost fail to do so within a few months. However, the parties did not declare a complete failure. Their rhetoric hasn't changed at all. They said they would give the talks another chance before Sunday, December 13. If there is no tangible progress, then London and Brussels will accept reality. Brexit will be tough, without a trade agreement. But this wording also leaves it possible to say that there is still some progress and to continue negotiations once again. In general, it is not a fact that everything will end this Sunday. However, both sides have called on their countries to prepare for a hard Brexit, and Michel Barnier has long said that the probability of a deal is extremely low. The British pound should be under market pressure in the coming days and weeks.

GBP/USD – 4H.

Exchange Rates 11.12.2020 analysis

On the 4-hour chart, the GBP/USD pair performed a new fall to the corrective level of 76.4% (1.3291). Despite the looming bullish divergence in the MACD indicator, fixing the pair's rate below the level of 76.4% will allow us to count on a further drop in quotes towards the next level of 61.8% (1.3174). The information background can now seriously contribute to the fall of the British pound.

GBP/USD – Daily.

Exchange Rates 11.12.2020 analysis

On the daily chart, the pair's quotes performed a rebound from the corrective level of 100.0% (1.3513). And this is the most important and clear signal on all charts. If the rebound is not false (and so far it does not look false), then the Briton is waiting for a noticeable drop. Lower charts may also generate strong sell signals in the coming hours.

GBP/USD – Weekly.

Exchange Rates 11.12.2020 analysis

On the weekly chart, the pound/dollar pair performed an increase to the second downward trend line. A rebound from it in the long term will mean a reversal in favor of the US dollar and a long fall in the British dollar's quotes.

Overview of fundamentals:

On Thursday, the UK released reports on GDP and industrial production. Both were failures or weak. However, traders expectedly began to get rid of the pound after having received information from Brussels.

Us and UK news calendar:

UK - Bank of England Governor Andrew Bailey will deliver a speech (08:30 GMT).

On December 11, the UK will host a speech by the Governor of the Bank of England, who can comment on the situation with the almost failed negotiations on a trade agreement.

COT (Commitments of Traders) report::

Exchange Rates 11.12.2020 analysis

The latest COT report showed a new increase in the number of long contracts held by speculators. This time, their total number increased by 3,601 contracts, and the number of short-contracts decreased by 4,441 units. Thus, the mood of speculators has become much more "bullish". At the same time, this is a very rare situation. The number of long and short contracts focused on the hands of the "Non-commercial" and "Commercial" categories is almost equal. The same applies to data for all categories of major players. Thus, the market is now in balance, however, the future of the British is still more dependent on the outcome of trade negotiations between London and Brussels. Major traders will also adjust to these results. Thus, their mood may change very sharply, based on the results of the negotiations.

GBP/USD forecast and recommendations for traders:

At this time, I recommend that you be extremely careful with opening any deals on the British. The pair continues to move very raggedly and often changes direction. I recommend making new purchases of the British dollar if the rebound from the level of 127.2% (1.3264) is completed with the target of 1.3375 on the hourly chart. I recommend selling the British dollar with the targets of 1.3176 and 1.3099 if the close is made under the level of 127.2% on the hourly chart.

Terms:

"Non-commercial" - major market players: banks, hedge funds, investment funds, private, large investors.

"Commercial" - commercial enterprises, firms, banks, corporations, companies that buy currency not for speculative profit, but for current activities or export-import operations.

"Non-reportable positions" - small traders who do not have a significant impact on the price.

Przedstawiono Samir Klishi,
przez eksperta analitycznego
z grupy firm InsaForex © 2007-2024
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