GBP/USD. March 19. COT report. The British dollar fell after the Bank of England left its monetary policy unchanged.

GBP/USD – 1H.

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According to the hourly chart, the GBP/USD pair quotes performed a rebound from the corrective level of 38.2% (1.3980), a reversal in favor of the US currency, and a fall to the Fibo level of 50.0% (1.3900). However, the rebound was also made from the level of 50.0%, which allows traders to count on some growth in the direction of the corrective level of 38.2% (1.3980). Closing the pair's rate under the Fibo level of 50.0% will work in favor of continuing the fall towards the next corrective level of 61.8% (1.3820). Meanwhile, the latest drop in the British pound was fairly easy to predict. One has only to look at the behavior of traders around the level of 1.3980 in the last two weeks and it becomes clear that the probability of closing above this level was low. Also, the yield on US 10-year Treasury bonds rose again yesterday. And we remember that traders like to respond to the growth of profitability by buying the dollar. Also, yesterday, the Bank of England held a meeting, which left all the main parameters of monetary policy unchanged, that is, it once again took a wait-and-see position, which could hardly please traders, given the serious problems in the British economy. It is worth reminding once again that many have long been waiting for the Bank of England to lower the rate again or introduce any additional stimulus measures. But instead, the Bank of England has signaled to markets that it is not going to tighten monetary policy until inflation reaches a steady 2%. Thus, it is safe to say that the meetings of the Fed and the Bank of England this week disappointed traders.

GBP/USD – 4H.

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On the 4-hour chart, the GBP/USD pair performed a rebound from the level of 1.3850, an increase to the Fibo level of 161.8% (1.3979), a rebound from this level, and a reversal in favor of the US currency. As a result, the pair's quotes intend to make a return to the level of 1.3850. The upward trend line is no longer working. But, as in the case of the euro currency, there is a side corridor, which is visible on the hourly chart.

GBP/USD – Daily.

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On the daily chart, the pair's quotes continue to be above the ascending trend line. In the long term, the "bullish" mood of traders is still preserved. Closing the pair's rate above the Fibo level of 127.2% (1.4084) will work in favor of continuing growth towards the next corrective level of 161.8% (1.4812).

GBP/USD – Weekly.

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On the weekly chart, the pound/dollar pair performed 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, there were no other important events in the UK besides the results of the Bank of England meeting. In the US, Jerome Powell's speech did not give traders any new information.

News calendar for the United States and the United Kingdom:

On Friday, the calendars of economic events in the United States and Britain are empty, so today the information background will be absent.

COT (Commitments of Traders) report:

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The latest COT report from March 9 on the British was quite interesting. A week earlier, I drew readers' attention to the fact that the nature of the COT reports on the euro and the pound were opposite. This time, the mood of the "Non-commercial" category of traders in the UK also became more "bearish". During the reporting week, speculators closed 5.5 thousand long contracts and opened only 344 short contracts. Thus, the belief that the Briton will continue its growth is falling among the major players. But it is falling at a much weaker rate than that of the major players in the European market. So the British pound is much less likely to fall than the euro and much more likely to rise than the euro.

GBP/USD forecast and recommendations for traders:

I recommend buying the British dollar today in case of a rebound from the level of 1.3900 on the hourly chart with a target of 1.3980. It was recommended to sell the pound sterling if there is a rebound from the area of 1.3980-1.4000 on the hourly chart with a target of 1.3900. Now, if you close at 1.3900, I recommend continuing to sell with a target of 1.3820.

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.

The material has been provided by InstaForex Company - www.instaforex.com

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