GBP/USD – 1H.
According to the hourly chart, the quotes of the GBP/USD pair reversed in favor of the British pound and closed above the Fibo level of 61.8% (1.3820). Thus, the increase can continue in the direction of the next corrective level of 50.0% (1.3900). I would like to immediately draw attention to the fact that the euro and the pound are now moving in different keys. The British dollar started a new increase more than a week ago, and the euro currency has been falling all this time. Thus, we can assume that the pound reacts to a different information background. Or, the information background for the British is somewhat different. Most likely, this is because the third wave of the epidemic has begun in the European Union, and the situation with vaccination of the population remains quite difficult. While in the US and the UK, there are no such problems yet. Therefore, the British dollar may show growth in the current circumstances.
Yesterday, the UK also released the index of business activity in the manufacturing sector, which also exceeded the expectations of traders and amounted to 58.9, which is also a fairly high value. However, more important reports will be released today. By and large, traders have already focused on only one report – Nonfarm Payrolls for March. The ADP report that preceded this report showed a fairly high increase in workers in the private sector, which allows us to hope for high NonFarms. Thus, the US dollar, given that it has not grown in recent days, may receive support from traders today, if the value of NonFarms is not weaker than 633 thousand. A value below this figure can just cause disappointment and a fall in the dollar.
GBP/USD – 4H.
On the 4-hour chart, the GBP/USD pair rose to the downward trend line and a close above it. However, there has not yet been a close above the level of 1.3850. If this happens, the increase can continue towards the next corrective level of 161.8% (1.3979). The mood of traders will change to "bullish" if the breakdown of the trend line is not false.
GBP/USD – Daily.
On the daily chart, the pair's quotes rebounded from the upward trend line. Thus, in the long term, the "bullish" mood of traders remains. However, the bears may make a new attempt to close under the trend line at any time.
GBP/USD – Weekly.
On the weekly chart, the pound/dollar pair closed over the second downward trend line. Thus, the chances of long-term growth of the pound remain.
Overview of fundamentals:
On Thursday, the UK and the US released indices of business activity in the manufacturing sectors, however, they did not affect the movement of the pair too much.
News calendar for the United States and the United Kingdom:
US - unemployment rate (12:30 UTC).
US - change in the number of people employed in the non-agricultural sector (12:30 UTC).
US - change in the average hourly wage (12:30 UTC).
On Friday in the UK, the calendar of economic events is empty. But in the US, there will be very important reports that can not be ignored by traders.
COT (Commitments of Traders) report:
The latest COT report on March 23 for the British pound showed moderate changes in the mood of major players. The category of "Non-commercial" traders again got rid of long contracts, closing 3,249 of them, and also increased short contracts, opening 4,405 of them. Thus, the mood of speculators has again become much more "bearish". However, this effect is achieved mainly by reducing the number of long contracts. In general, in recent months, the total number of short-contracts focused on the hands of speculators has not changed - 30-40 thousand. Thus, the British dollar can continue to fall, and the trend line on the 4-hour chart will help determine the moment when it will end.
GBP/USD forecast and recommendations for traders:
It was possible to buy the British dollar after overcoming the Fibo level of 61.8% (1.3820) with a target of 1.3900. Although I recommend waiting for the close above the level of 1.3850 on the 4-hour chart. It is recommended to sell the pound when the quotes rebound from the level of 1.3850 on the 4-hour chart with the targets of 1.3701 and 1.3481.
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.
