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GBP/USD 1H
The GBP/USD currency pair, unlike the EUR/USD, was trading quite actively on Friday, and most importantly, there was an intraday trend. After a day spent in the narrow price range of 1.2404-1.2424, sellers became more active and began to actively open sell positions. Thus, at the moment, a downward trend remains despite the fact that quotes previously left the downward channel, providing a signal for a possible new upward trend. However, as we said earlier, the British pound has little prospects for growth. Mainly due to the negative fundamental background from the UK. There is not much news itself, but on the whole, Brexit is still completely unresolved and the uncertainty with future relations between the UK and the European Union will not allow the British currency to go up in the long run.
GBP/USD 15M
Both linear regression channels continue to be downward on the 15-minute timeframe, so the overall trend in the short term remains down.
COT Report
The latest COT report, which covers dates June 17-23, shows minimal changes. A group of professional traders were extremely inactive during the indicated period of time and opened only 3,500 new transactions. Of these, 1,200 for purchase and 2,000 for sale. At the same time, a group of hedgers were even less active and closed 343 contracts for the purchase and opened 2,500 contracts for the sale. This is very small. However, this was enough for the pound to resume its decline. This happened after June 23, that is, in that time period that is not covered by the latest COT report. Thus, no conclusions can be drawn from the latest report. The mood of traders has not changed, and the total number of open positions opened by a group of professional traders remains with an advantage in short positions.
The fundamental background for the GBP/USD pair did not change on Friday. Recently, extremely little important and significant information has come from the United States and Great Britain. Market participants continue to expect positive news about the negotiation process between Brussels and London, but now there is no news at all. Especially a positive one. Meanwhile, the situation remains quite complicated in America, mainly due to a new outbreak of the coronavirus infection, which many call the second wave. We believe that this is not the second wave, but a continuation of the first one. However, the essence of this does not change. A large number of new cases of the disease continue to be recorded daily in the United States, so there is a risk that individual states will be quarantined again or serious restrictive measures will apply. Therefore, so that Donald Trump does not talk about the need to open the economy as soon as possible, if a large number of people get sick, this will not allow the economy to restart in full. Moreover, people's fear of an epidemic will not allow the economic activity of the population to fully recover, which means that growth will be restrained. However, so far this information has no negative impact on the US currency.
There are two main scenarios as of June 29:
1) Traders passed the support area of 1.2403-1.2423 on Friday, and the downward movement resumed. Therefore, the trend is downward again and we advise you to continue trading lower while aiming to support the level of 1.2229. Potential Take Profit in this case will be about 95 points. Further downward movement will depend on overcoming the area of support 1.2194-1.2214.
2) Buyers need to wait until they consolidate above the Kijun-sen line, which will give them a chance to resume moving upward with targets at the resistance level of 1.2573 and the resistance area of 1.2719-1.2759. Overcoming each target will allow traders to stay in buy positions. Potential Take Profit in this case will be from 125 to 270 points.
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