GBP/USD – 1H.
According to the hourly chart, the quotes of the GBP/USD pair performed on Tuesday a fall to the corrective level of 61.8% (1.3820), a rebound from it, a reversal in favor of the British dollar, and an increase to the Fibo level of 50.0% (1.3900). The rebound of quotes from this level will allow traders to count on a reversal in favor of the US currency and the resumption of the fall in the direction of the level of 1.3820. Closing the pair's rate above the level of 50.0% will work in favor of continuing growth in the direction of the next Fibo level of 38.2% (1.3980). All the latest news from the UK is colored in a negative shade. One positive news – good vaccination rates. All the other news concerns the record-high public debt in Britain, the huge budget deficit for 2021, the conflict with the European Union concerning London's non-compliance with the terms of the Brexit agreement and, in particular, the protocol on the Northern Ireland border, a possible conflict on the island of Ireland itself, and the possible separation of Scotland. And all this is "seasoned" with a drop in GDP in January by 2.9% and a serious drop in import and export operations with the European Union in early 2021. Thus, the pound sterling should now be aiming for the level of 1.3000. However, in America, everything is also not too "sweet". For example, yesterday's reports on industrial production and retail sales were extremely weak, which negatively affected the dollar. Also, Joe Biden and the US Congress approved the allocation of another 1.9 trillion dollars in the framework of the program to support the economy and soon this money will flow to the markets, which can also negatively affect the US currency. In general, while the markets are looking for a balance between all factors and waiting for the results of the meeting of the Fed and the Bank of England. After the completion of these events, it will be possible to build a further trading strategy.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair performed a close under the upward trend line, thus, the mood of traders changed to "bearish". However, as I warned yesterday, there was no clear close below the level of 1.3850. On the contrary, there was a rebound from this level, which speaks in favor of a possible resumption of the growth process, despite the closure under the trend line.
GBP/USD – Daily.
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.
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:
There was no major report or other events in the UK on Tuesday. And reports from the US led to a drop in demand for the US currency.
News calendar for the United States and the United Kingdom:
US - FOMC decision on the main interest rate (18:00 GMT).
US - FOMC accompanying statement (18:00 GMT).
US - FOMC economic forecast (18:00 GMT).
US - FOMC press conference (18:30 GMT).
On Wednesday, the calendar of economic events in Britain is again empty, however, the Fed meeting and its results can cause serious movements in the market.
COT (Commitments of Traders) report:
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:
It is recommended to buy the British dollar if it closes above the Fibo level of 50.0% (1.3900) on the hourly chart with a target of 1.3980. It is recommended to sell the pound sterling if there is a rebound from the level of 1.3900 on the hourly chart 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.
