Forecast and trading signals for GBP/USD on April 24th. COT Report. Detailed analysis of the pair’s movement and trading
April 24, 2023 8:22 am
GBP/USD Analysis 5M.
The GBP/USD currency pair continued to swing” on Friday. We observed a flat almost all of last week, so it is unsurprising that the week ended with a flat. In addition to the hourly TF flat, we also observed “swings” on Friday. The pair constantly changed its direction of movement, making life difficult for traders. The price crossed the important Senkou Span B line 5 or 6 times, which we recorded due to the flat on the hourly TF. Interestingly, there was no consolidation below this line on the hourly TF, but there was more than one on the 5-minute TF. Macroeconomic statistics on Friday were not the most important, but the business activity indices in the UK could have been better, and retail sales even contracted more than forecasted. The pound, in principle, fell during the European trading session. Still, it should have continued to fall by the same logic during the American session, as American business activity indices were stronger than forecasts. But we did not see any further decline, and the pound completely recovered all losses by the end of the day.
The first trading signal formed around the 1.2429 level, with only 29 points to the nearest target. A short position could bring traders just a few points, and the next buy signal around 1.2400 was false. Therefore, it resulted in a small loss; overall, the day ended with a small loss. All subsequent signals around Senkou Span B have yet to be worked out.
COT Report:
According to the latest report on the British pound, the “non-commercial” group closed 1.1 thousand buy contracts and 4.8 thousand sell contracts. Thus, the net position of non-commercial traders increased by 3.7 thousand and continues to grow. The net position indicator has steadily grown for 8–9 months. Still, the sentiment of major players during this time remained “bearish” (only now can it be said that it is “bullish,” but only formally), and since the pound sterling is growing against the dollar (in the medium term), it is very difficult to answer the question of why it is doing so from a fundamental point of view. We do not exclude the option that a new strong pound decline will begin in the near future. Both major pairs are moving similarly now, but the net position for the euro is positive and even implies the imminent completion of the upward impulse. At the same time, it allows for further growth for the pound. The British currency has already grown more than 2100 points, which is a lot, and without a strong downward correction, the continuation of growth will be illogical. The “non-commercial” group currently has 52 thousand contracts for sale and 54 thousand for purchase. We remain skeptical about the long-term growth of the British currency and expect it to fall.
GBP/USD Analysis 1H.
On the hourly timeframe, the pound/dollar pair began to decline and overcame important lines but could not continue to move downward. In the last few days, traders have dealt with the additional problem of flat with “swings.” Formally, the trend has changed to a downward one, and traders have the right to expect the formation of a downward trend, but the pound desperately does not want to fall. For April 24th, we highlight the following important levels: 1.1927, 1.1965, 1.2143, 1.2185, 1.2269, 1.2349, 1.2429-1.2458, 1.2520, 1.2589, 1.2659, 1.2762. Senkou Span B (1.2400) and Kijun-sen (1.2448) lines can also be sources of signals. Signals can be “rebounds” and “overcoming” of these levels and lines. The stop-loss level should be set at breakeven when the price passes in the correct direction for 20 points. The Ichimoku indicator lines may move during the day, which should be considered when determining trading signals. Also, support and resistance levels are present in the illustration, which can be used to fix trade profits. No important events are planned in the UK or the US on Monday, so we will have flat and low volatility again. Of course, the market may decide today that it is time to get down to business and trade more actively, but only some factors support such an option.
Explanation of illustrations:
Support and resistance price levels – thick red lines around which movement may end. They are not sources of trading signals.
Kijun-sen and Senkou Span B lines – Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour. They are strong lines.
Extreme levels – thin red lines from which the price has previously rebounded. They are sources of trading signals.
Yellow lines – trendlines, trend channels, and any other technical patterns.
Indicator 1 on the COT charts – the size of the net position for each category of traders.
Indicator 2 on the COT charts – the size of the net position for the “non-commercial” group.
The material has been provided by InstaForex Company – www.instaforex.com
GBP/USD Analysis 5M.
The GBP/USD currency pair continued to swing” on Friday. We observed a flat almost all of last week, so it is unsurprising that the week ended with a flat. In addition to the hourly TF flat, we also observed “swings” on Friday. The pair constantly changed its direction of movement, making life difficult for traders. The price crossed the important Senkou Span B line 5 or 6 times, which we recorded due to the flat on the hourly TF. Interestingly, there was no consolidation below this line on the hourly TF, but there was more than one on the 5-minute TF. Macroeconomic statistics on Friday were not the most important, but the business activity indices in the UK could have been better, and retail sales even contracted more than forecasted. The pound, in principle, fell during the European trading session. Still, it should have continued to fall by the same logic during the American session, as American business activity indices were stronger than forecasts. But we did not see any further decline, and the pound completely recovered all losses by the end of the day.
The first trading signal formed around the 1.2429 level, with only 29 points to the nearest target. A short position could bring traders just a few points, and the next buy signal around 1.2400 was false. Therefore, it resulted in a small loss; overall, the day ended with a small loss. All subsequent signals around Senkou Span B have yet to be worked out.
COT Report:
According to the latest report on the British pound, the “non-commercial” group closed 1.1 thousand buy contracts and 4.8 thousand sell contracts. Thus, the net position of non-commercial traders increased by 3.7 thousand and continues to grow. The net position indicator has steadily grown for 8–9 months. Still, the sentiment of major players during this time remained “bearish” (only now can it be said that it is “bullish,” but only formally), and since the pound sterling is growing against the dollar (in the medium term), it is very difficult to answer the question of why it is doing so from a fundamental point of view. We do not exclude the option that a new strong pound decline will begin in the near future. Both major pairs are moving similarly now, but the net position for the euro is positive and even implies the imminent completion of the upward impulse. At the same time, it allows for further growth for the pound. The British currency has already grown more than 2100 points, which is a lot, and without a strong downward correction, the continuation of growth will be illogical. The “non-commercial” group currently has 52 thousand contracts for sale and 54 thousand for purchase. We remain skeptical about the long-term growth of the British currency and expect it to fall.
GBP/USD Analysis 1H.
On the hourly timeframe, the pound/dollar pair began to decline and overcame important lines but could not continue to move downward. In the last few days, traders have dealt with the additional problem of flat with “swings.” Formally, the trend has changed to a downward one, and traders have the right to expect the formation of a downward trend, but the pound desperately does not want to fall. For April 24th, we highlight the following important levels: 1.1927, 1.1965, 1.2143, 1.2185, 1.2269, 1.2349, 1.2429-1.2458, 1.2520, 1.2589, 1.2659, 1.2762. Senkou Span B (1.2400) and Kijun-sen (1.2448) lines can also be sources of signals. Signals can be “rebounds” and “overcoming” of these levels and lines. The stop-loss level should be set at breakeven when the price passes in the correct direction for 20 points. The Ichimoku indicator lines may move during the day, which should be considered when determining trading signals. Also, support and resistance levels are present in the illustration, which can be used to fix trade profits. No important events are planned in the UK or the US on Monday, so we will have flat and low volatility again. Of course, the market may decide today that it is time to get down to business and trade more actively, but only some factors support such an option.
Explanation of illustrations:
Support and resistance price levels – thick red lines around which movement may end. They are not sources of trading signals.
Kijun-sen and Senkou Span B lines – Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour. They are strong lines.
Extreme levels – thin red lines from which the price has previously rebounded. They are sources of trading signals.
Yellow lines – trendlines, trend channels, and any other technical patterns.
Indicator 1 on the COT charts – the size of the net position for each category of traders.
Indicator 2 on the COT charts – the size of the net position for the “non-commercial” group.
The material has been provided by InstaForex Company – www.instaforex.com
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