GBP/USD – 1H.
According to the hourly chart, the quotes of the GBP/USD pair performed an increase to the level of 1.3976. The rebound of quotes from this level allowed traders to count on a reversal in favor of the US currency and some fall. But, as we can see, no fall has begun. Closing the pair's rate above the level of 1.3976 will increase the chances of further growth towards the next corrective level of 200.0% (1.4063). Yesterday, a member of the monetary committee of the Bank of England, Michael Saunders, gave a speech. A short background. All the recent comments of the Governor of the Bank of England, Andrew Bailey, spoke in favor of the fact that the regulator does not abandon the introduction of negative rates, but not in the near future. The markets stubbornly interpreted this information as positive, continuing to buy the pound sterling. At the same time, the comments of other members of the board of directors, for example, Silvana Tenreyro, who stated the need to lower the rate, were ignored by traders. Yesterday, Michael Saunders said that negative rates may soon become "the best tool of the Bank of England". Saunders expects a very long recovery in the labor market. Let me remind you that the unemployment rate in the UK is now only 5%. However, according to the latest research, it may grow by several percent, as the state business support programs expire in March-April. If new programs are not introduced, then many companies will be ready to reduce their staff. Thus, it is now very important for the UK to resolve the issue of further state support. However, traders do not show any concerns about this. The British dollar continues to trade very high and does not react to such comments from the country's top economists.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair made a return to the level of 1.3850, and after the formation of a bullish divergence at the CCI indicator, it performed a reversal in favor of the European currency and resumed the growth process. At the moment, the quotes were near the corrective level of 161.8% (1.3979). The rebound of the pair from this level will work in favor of the US currency and some fall in the direction of 1.3850. The brewing bearish divergence increases the probability of a rebound. Closing above the level of 161.8% will allow traders to expect further growth in the direction of 1.4126.
GBP/USD – Daily.
On the daily chart, the pair's quotes made a consolidation above the corrective level of 100.0% (1.3513), which still allows us to count on continued growth in the direction of the Fibo level of 127.2% (1.4084).
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 are significantly increased.
Overview of fundamentals:
On Thursday, the US and UK calendars were almost empty, so the impact of the information background was minimal.
News calendar for the United States and the United Kingdom:
UK - change in retail trade volume with and without fuel costs (07:00 GMT).
UK - manufacturing PMI (09:30 GMT).
UK - PMI index for the services sector (09:30 GMT).
US - index of business activity in the manufacturing sector (14:45 GMT).
US - PMI index for the service sector (14:45 GMT).
On February 19, the calendars of economic events in the United Kingdom and the United States contain business activity indices. In the UK, a report on retail sales will also be released. All this data can pass traders by. The Briton continues to grow without them.
COT (Commitments of Traders) report:
The latest COT report of February 9 on the British pound was quite interesting and noteworthy. In recent weeks, speculators have not made serious steps in the direction of strengthening the "bullish" mood. However, all this time, the pound was still growing. The latest COT report showed an increase in the number of long contracts focused on the hands of the "Non-commercial" category of traders by 6,465 units. At the same time, speculators got rid of 4,660 short contracts. Thus, the Briton grew even without increasing long contracts from speculators. Now it has an even greater chance of continuing growth.
Forecast for GBP/USD and recommendations for traders:
It was recommended to buy the British dollar in the event of a rebound from the level of 1.3850 on the 4-hour chart with a target of 1.3976. This rebound was completed, reinforced by bullish divergence, and the goal was achieved. I recommend new purchases when closing above 1.3979 with a target of 1.4126. I recommend selling the pound sterling at the rebound from the level of 1.3979 on the 4-hour chart with a target of 1.3850.
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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