GBP/USD: plan for the US session on March 17 (analysis of morning trades)
March 17, 2021 1:22 pm
To open long positions on GBP/USD, you need to:
In my morning forecast, I paid attention to the level of 1.3903 and recommended opening long positions from it. Let’s look at the 5-minute chart and analyze the trades: it is visible how the bulls achieve a breakout of the resistance of 1.3903, continuing yesterday’s upward trend. After that, a return and a reverse test of this level from top to bottom occurred. The condition for forming a signal to open long positions is met. The upward movement was 26 points, however, I was counting on a larger increase. We did not reach the target value indicated in the morning.
The technical picture for the second half of the day has completely changed, especially if we take into account the upcoming meeting of the Federal Reserve System, from which many expect changes in the leading indicator. The initial task of the bulls will be to protect the support of 1.3880, where the formation of a false breakout forms a signal to open long positions in the expectation of continuing the upward trend. In this case, the nearest target will be the resistance at 1.3943, where I recommend taking the profit. It will be possible to break above this range in the event of news about the planned change in the Federal Reserve’s monetary policy in the near future. A break of 1.3943 with a test of this level from top to bottom forms an additional signal to buy the pound already to reach the maximum of 1.4000, where I recommend taking the profits. If there is no activity in the support area of 1.3880, it is best to postpone long positions until the test of a large minimum of 1.3812, from which you can buy GBP/USD immediately for a rebound in the expectation of a correction of 30-35 points within the day. The next major support area is seen around 1.3732.
To open short positions on GBP/USD, you need to:
The initial task of sellers for the second half of the day is to break through and consolidate below the support of 1.3880. There are also moving averages that play on the side of buyers. A test of this level from the bottom up forms an excellent entry point into short positions in the expectation of resuming the downward correction and updating the support at 1.3812, where I recommend taking the profits. If the Federal Reserve does not signal a change in its attitude to monetary policy in the near future, then we can expect a larger movement of the GBP/USD already in the area of the minimum of 1.3732. If the pound rises in the second half of the day, the bears can rely on the resistance of 1.3943, however, I recommend opening short positions from it only if a false breakout is formed. You can sell the pound immediately on a rebound from the maximum of 1.4000 in the expectation of a correction of 30-35 points within the day.
Let me remind you that the COT reports (Commitment of Traders) for March 9 recorded a reduction in both short and long commercial positions. This time, the closing of long positions was quite strong, which led to a reduction in the positive delta. The main problem for risky assets, which include the British pound, remains the growth of US bond yields, which provides serious support to the US dollar. However, in the medium term, buyers of the pound will certainly take advantage of this moment to enter the market at more attractive prices. The start of the curtailment of quarantine measures in March this year will continue to provide the main support to the pound, as will new measures to help the UK population in the fight against the coronavirus pandemic. Long non-profit positions declined from 65,138 to 61,271. At the same time, short non-profit positions declined from 29,056 to 27,360, which indicates a possible further decline in the pair. As a result, the non-profit net position fell to 33,911 from 36,082 a week earlier. The weekly closing price fell to 1.3821 against 1.3928. The observed downward correction in the pound will attract new buyers.
Signals of indicators:
Moving averages
Trading is conducted slightly above the 30 and 50 daily averages, which indicates that buyers of the pound retain temporary control over the market.
Note: The period and prices of the moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger Bands
A break of the lower limit of the indicator in the area of 1.3880 will increase the pressure on the British pound.
Description of indicators
Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
MACD indicator (Moving Average Convergence / Divergence – moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
Bollinger Bands (Bollinger Bands). Period 20
Non-profit 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 the short and long positions of non-commercial traders.
The material has been provided by InstaForex Company – www.instaforex.com
To open long positions on GBP/USD, you need to:
In my morning forecast, I paid attention to the level of 1.3903 and recommended opening long positions from it. Let’s look at the 5-minute chart and analyze the trades: it is visible how the bulls achieve a breakout of the resistance of 1.3903, continuing yesterday’s upward trend. After that, a return and a reverse test of this level from top to bottom occurred. The condition for forming a signal to open long positions is met. The upward movement was 26 points, however, I was counting on a larger increase. We did not reach the target value indicated in the morning.
The technical picture for the second half of the day has completely changed, especially if we take into account the upcoming meeting of the Federal Reserve System, from which many expect changes in the leading indicator. The initial task of the bulls will be to protect the support of 1.3880, where the formation of a false breakout forms a signal to open long positions in the expectation of continuing the upward trend. In this case, the nearest target will be the resistance at 1.3943, where I recommend taking the profit. It will be possible to break above this range in the event of news about the planned change in the Federal Reserve’s monetary policy in the near future. A break of 1.3943 with a test of this level from top to bottom forms an additional signal to buy the pound already to reach the maximum of 1.4000, where I recommend taking the profits. If there is no activity in the support area of 1.3880, it is best to postpone long positions until the test of a large minimum of 1.3812, from which you can buy GBP/USD immediately for a rebound in the expectation of a correction of 30-35 points within the day. The next major support area is seen around 1.3732.
To open short positions on GBP/USD, you need to:
The initial task of sellers for the second half of the day is to break through and consolidate below the support of 1.3880. There are also moving averages that play on the side of buyers. A test of this level from the bottom up forms an excellent entry point into short positions in the expectation of resuming the downward correction and updating the support at 1.3812, where I recommend taking the profits. If the Federal Reserve does not signal a change in its attitude to monetary policy in the near future, then we can expect a larger movement of the GBP/USD already in the area of the minimum of 1.3732. If the pound rises in the second half of the day, the bears can rely on the resistance of 1.3943, however, I recommend opening short positions from it only if a false breakout is formed. You can sell the pound immediately on a rebound from the maximum of 1.4000 in the expectation of a correction of 30-35 points within the day.
Let me remind you that the COT reports (Commitment of Traders) for March 9 recorded a reduction in both short and long commercial positions. This time, the closing of long positions was quite strong, which led to a reduction in the positive delta. The main problem for risky assets, which include the British pound, remains the growth of US bond yields, which provides serious support to the US dollar. However, in the medium term, buyers of the pound will certainly take advantage of this moment to enter the market at more attractive prices. The start of the curtailment of quarantine measures in March this year will continue to provide the main support to the pound, as will new measures to help the UK population in the fight against the coronavirus pandemic. Long non-profit positions declined from 65,138 to 61,271. At the same time, short non-profit positions declined from 29,056 to 27,360, which indicates a possible further decline in the pair. As a result, the non-profit net position fell to 33,911 from 36,082 a week earlier. The weekly closing price fell to 1.3821 against 1.3928. The observed downward correction in the pound will attract new buyers.
Signals of indicators:
Moving averages
Trading is conducted slightly above the 30 and 50 daily averages, which indicates that buyers of the pound retain temporary control over the market.
Note: The period and prices of the moving averages are considered by the author on the hourly chart H1 and differ from the general definition of the classic daily moving averages on the daily chart D1.
Bollinger Bands
A break of the lower limit of the indicator in the area of 1.3880 will increase the pressure on the British pound.
Description of indicators
The material has been provided by InstaForex Company – www.instaforex.com
Related Posts: