24.09.202108:09 Forex-elemzések és áttekintések: GBP/USD: plan for the European session on September 24. COT reports. Pound still has problems with growth. Pound rises following Bank of England tone change on monetary policy

To open long positions on GBP/USD, you need:

Quite a lot of profitable signals to buy the pound were formed yesterday, but all of them were in the afternoon after the Bank of England's meeting on monetary policy. Let's take a look at a 5-minute chart and talk about where and how you could enter the market. In my morning forecast, I paid attention to the 1.3649 level and advised you to make decisions on entering the market. A breakthrough of this range, unfortunately, did not result in creating a signal to open long positions in the first half of the day, since literally a couple of points were missing before the reverse test of this level, and trading against the trend without clear confirmation of signals is not a good idea. Therefore, I missed this upward movement. After the news that the Bank of England raised the topic of raising interest rates in November this year, the pound continued to actively rise. Forming a false breakout at the level of 1.3654 resulted in creating the first entry point into long positions. Then there was a breakthrough and a reverse test of 1.3696 - again buying the pound. And the final was the breakthrough and test of the 1.3727 level, which also provided a good entry point into long positions. As a result, all of the pound's movement after the BoE's decision was taken away.

Today we expect to receive a report on retail sales from the Confederation of British Industrialists, as well as a speech by Silvana Tenreyro, a member of the ILC of the Bank of England, who may further shake the markets with her statements on monetary policy, which will pushed the pound to rise in the short term. It is best to bet on strengthening the pair. The optimal scenario for opening long positions will be a false breakout in the support area of 1.3708, to which the British pound is gradually heading. In this case, we can count on further growth to the resistance of 1.3747, which became problematic for the bulls in yesterday's US session. Only a breakthrough of this level and a top-down test will create another entry point to long positions with the goal of rising towards highs like 1.3774 and 1.3803, where I recommend taking profits. If the pressure on GBP/USD persists in the first half of the day, and the bulls are not active in the support area of 1.3708, it is best not to rush with long positions, as yesterday's bullish movement can crumble very quickly. The optimal scenario would be buying the pound from the level of 1.3670, slightly above which the moving averages are, playing on the side of the bulls. I advise you to open long positions in GBP/USD immediately on a rebound in the 1.3635 area, or even lower - from 1.3604 with the goal of an upward correction of 15-20 points within the day.

To open short positions on GBP/USD, you need:

The initial task of the bears is to protect resistance at 1.3747, which the bulls will be focusing on in the first half of the day. Forming a false breakout at this level, along with weak fundamental data on retail sales, can seriously harm the short-term plans of the bulls, which creates an excellent entry point into short positions with the goal of moving to the support area of 1.3708. This level is very important for the bulls who will try to build the lower boundary of a new rising channel there. Therefore, the bears' goal is to break through and test this area from the bottom up, which will hit the stop orders of speculative bulls and form an additional entry point into short positions with the goal of pulling down GBP/USD even lower - to 1.3670. With very active short positions on the pound during the speech of BoE representatives, the next target will be the 1.3635 low. If the bears are not active in the area of 1.3747 in the first half of the day, I advise you to postpone short positions until a new large resistance at 1.3774 during the test of which divergence may form on the MACD indicator, indicating that the pound is overbought. I also recommend opening short positions from there only if a false breakout is formed. Selling GBP/USD immediately on a rebound is possible from the high in the 1.3803 area, counting on a downward correction of 25-30 points within the day.

I recommend for review:

The Commitment of Traders (COT) reports for September 14 revealed a sharp positive dynamics in net position and a rather large inflow of long non-commercial positions along with a decrease in short ones. And although the British pound remains under pressure against the US dollar, the clear decline in the trading instrument indicates a rather high interest in long positions on the part of major players. It is possible that the sharp rise in inflation in the UK forced many traders to reconsider their attitude towards the Bank of England's monetary policy in the direction of its possible tightening. However, the fact that BoE representatives are in no hurry to talk about these changes affects the activity of traders. I advise you to continue with the strategy of buying the pound in case of any good decline. The lower the pound falls, the more active buyers of risky assets will begin to show themselves, betting on real changes in the BoE's monetary policy in the future. The COT report indicated that long non-commercial positions sharply rose from 29,348 to 44,161, while short non-commercial positions fell 53,872 to 39,371, indicating an advantage towards buyers of the pound and offsetting the market situation. As a result, the non-commercial net position returned to a positive value and rose from -24,524 to 4,790 a week earlier. Last week's closing price remained practically unchanged and reached 1.3837 against 1.3838 a week earlier.

Indicator signals:

Moving averages

Trading is carried out above 30 and 50 moving averages, which indicates the build up of an upward correction for the pair, which has been asked for quite a long time.

Moving averages

Note: The period and prices of moving averages are considered by the author on the H1 hourly chart and differs from the general definition of the classic daily moving averages on the daily D1 chart.

Bollinger Bands

A breakthrough of the upper border of the indicator in the area of 1.3747 will lead to a new will of the pound's growth. In case the pair falls, support will be provided by the lower border at 1.3690.

Description of indicators

• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
• Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
• MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
• Long non-commercial positions represent the total long open position of non-commercial traders.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between short and long positions of non-commercial traders.