02.06.202002:08 Forex Analysis & Reviews: Hot forecast and trading signals for the GBP/USD pair on June 2. COT report. EU is not going to give London any "special privileges" under the agreement

GBP/USD 1H

The pound/dollar unexpectedly continued its upward movement on Monday, which also increased. Buyers managed to overcome the resistance area of 1.2403-1.2423, as well as the first resistance level for this week at 1.2434. Therefore, the path to growth is now clear until the next resistance level of 1.2529, to which, however, there isn't much, only 30 points. If the bulls do not pause near this target, then it will be possible to trade for an increase with the target of 1.2664. Although, from our point of view, all this sharp rise in the pound's price raises questions and doubts about its validity. Of course, the pound cannot constantly get cheaper, and the situation in America is also discouraging and dangerous, there are also enough uncertainties, however, the British currency's growth has begun too sharply. In any case, while the technical data speaks in favor of continuing the upward movement, the trend line confidently supports the traders to increase.

GBP/USD 15M

Both linear regression channels continue to be directed upward on the 15-minute timeframe, therefore, there are no signs of ending the upward trend here, just as there are no signs of the beginning of the correctional movement.

COT Report

Despite the fact that, in total, among all major market participants, the demand for the pound sterling did not change during the reporting week (a total of 8600 contracts for buying and selling were opened), professional traders mostly bought the pound sterling - +5205 contracts, and on the contrary, they got rid of the contracts for selling at -1,686 transactions. Thus, the mood of traders remains upward, and at the end of last week the situation, in principle, has not changed. But in order for the upward movement to continue, it is necessary that large traders continue to invest in the British currency, and for this we need reasons and reasons, which, in the pound's case, are now quite difficult to find. Nevertheless, the GBP/USD pair continues to grow at the beginning of the new week, which means that the demand for the pound does not decrease.

The fundamental background for the British pound remains negative in spite of the fact that this currency continues to go up together with the dollar. On the first trading day of the week, the report on business activity in the UK manufacturing sector, which was 40.7 with a forecast of 40.6, is not particularly important at this time. No important publication in the United Kingdom and the United States for today. On Monday, a new, fourth round of negotiations between Brussels and London began on an agreement that could take effect on January 1, 2021 and would determine the relationship between the UK and the EU. However, yesterday it became known that the chances of making any progress during this round are as small as in previous times. The European Union published a document stating that David Frost and Britain as a whole may not expect to receive any privileges from the EU that were given to other partners of the bloc. The EU believes that each agreement is "unique" and should be discussed until both parties are satisfied. In the case of Great Britain, which is forcing events and even during the time of the global pandemic and global crisis, does not want to postpone the "transition period", which could give additional time for negotiations, this will not work. Thus, the chances of a deal continue to fall, and the chances that the British economy will be even harder next year are growing.

There are two main scenarios as of June 2:

1) The initiative for the pound/dollar pair remains in the hands of the bulls and, since several important resistance has been overcome, traders are advised to stay in purchases with targets at resistance levels of 1.2529 and 1.2664. The movement was very strong on Monday, therefore, the correction can be strong and begin abruptly and unexpectedly. Take Profit will be about 30 points in the first case and 160 in the second.

2) Sellers continue to remain in the shadow and will be ready to return to the market only below the ascending trend line. Of course, short positions can be considered before, but now there are no prerequisites for this at all. We consider the minimum necessary condition for sellers to overcome the area of 1.2403-1.2423. Then it will be possible to sell the pair while aiming for the Kijun-sen line (1.2344) and the trend line (1.2300). In this case, Take Profit will be from 55 to 115 points.