GBP/USD: trading plan for the US session on February 17 (analysis of morning deals)
February 17, 2023 1:24 pm
You require the following to open long positions on the GBP/USD:
In my morning forecast, I focused on the level of 1.1919 and provided recommendations based on it for market entry decisions. Let’s analyze the 5-minute chart to see what happened. Following a minor decline in the value of the pound against the backdrop of an absence of statistics and in keeping with yesterday’s trend, a false breakout developed at the level of 1.1919, which only provided a great entry point for purchase. The increase was almost 25 points at the time this was written. Technically speaking, the second half of the day has not seen any changes. The US statistics could cause the pound to decline once more, but what FOMC members Michelle Bowman and Thomas Barkin have to say is considerably more intriguing. The pressure on the pound will probably lessen by the end of the week if we do not hear anything new from them, giving purchasers another opportunity to defend 1.1919. Due to this, I suggest you reconsider your purchases from the closest support level of 1.1919, but only after the emergence of a false breakout using the comparison I made above. This will serve as a signal to purchase the pound in anticipation of a rise to around 1.1974. I will wager on the continuation of the movement of the GBP/USD up to the maximum of 1.2022, which is just below where the moving averages are playing on the sellers’ side when fixing and testing this range from top to bottom. At 1.2070, where I fix profits, an exit above this level will also offer up growth potential. The pressure on GBP/USD will intensify if the bulls are unable to complete the tasks and miss 1.1919 in the afternoon, which in a bear market like this cannot be ruled out even at the end of the week. In this scenario, I suggest that you wait before making any purchases and only start long positions around the next support level of 1.1875 and only in the event of a false breakout. With the target of a fall of 30-35 points within the day, I will purchase GBP/USD as soon as it recovers just from 1.1829.
For opening short positions on the GBP/USD, you will need:
The pound’s sellers tried everything to keep the trend going, but they encountered enough resistance around 1.1919 that it might lead to profit-taking and a stronger upward movement later in the day. Because of this, protecting 1.1974 is a top priority, which in the present scenario would be a great indication to sell the pair. Growth and the development of a false breakout could result in the opening of short positions and the repeated movement of GBP/USD down to 1.1919. A break and reverse test of this area, together with hawkish comments from Federal Reserve System members that it is necessary to hike interest rates further, will cancel buyers’ plans to return to the market following yesterday’s selling, reinforcing bears’ presence in the market and producing a sell signal with a decline below 1.1875. The 1.1829 area will be the farthest target, and an update there will signal the continuation of the downward trend. I’ll set the profit there. Profit-taking may start at the end of the week given the possibility of GBP/USD growth and the lack of bears around 1.1974 in the afternoon. In this scenario, I suggest delaying sales until a false breakout occurs in the vicinity of the subsequent resistance level of 1.2022, which will serve as an entry opportunity for short positions. If there isn’t any activity, I’ll sell GBP/USD right away at its highest price of 1.2070, but only if I believe the pair will decline another 30-35 points during the day.
The CFTC has been experiencing a technical issue that has prevented the publication of new COT reports for more than two weeks. The most recent data is for January 24.
Both long and short positions were dramatically reduced in the COT report (Commitment of Traders) for January 24. But the present fall was within an acceptable range, particularly in light of the difficulties the UK government is currently facing as it battles strikes and demands for wage increases while also attempting to achieve a steady decline in inflation. Yet for the time being, all of this is receding into the background as we await the meetings of the Federal Reserve System, whose policy is anticipated to be less aggressive, and the Bank of England, whose pronouncements are certain to keep an aggressive tone by raising the rate by 0.5% once more. All of this will benefit the British pound, so I’ll wager on it strengthening even more, unless, of course, something extraordinary occurs. According to the most recent COT data, long non-commercial positions declined by 6,713 to 34,756, while short non-commercial positions decreased by 7,476 to 58,690, resulting in a fall in the non-commercial net position’s negative value to -23,934 from -24,697 a week earlier. We will continue to keep a careful eye on the economic indicators for the UK and the decision made by the Bank of England because such insignificant changes do not significantly alter the balance of power. In contrast to 1.2290, the weekly ending price increased to 1.2350.
Signals from indicators
Moving Averages
Trade is taking place below the 30- and 50-day moving averages, which suggests that sellers of the pound have returned to the market.
Note that the author’s consideration of the period and cost of moving averages on the hourly chart H1 differs from the standard definition of the traditional daily moving averages on the daily chart D1.
Bands by Bollinger
The indicator’s upper limit, which is located at 1.2022, will serve as resistance in the event of growth.
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, use the futures market for speculative purposes and to 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
You require the following to open long positions on the GBP/USD:
In my morning forecast, I focused on the level of 1.1919 and provided recommendations based on it for market entry decisions. Let’s analyze the 5-minute chart to see what happened. Following a minor decline in the value of the pound against the backdrop of an absence of statistics and in keeping with yesterday’s trend, a false breakout developed at the level of 1.1919, which only provided a great entry point for purchase. The increase was almost 25 points at the time this was written. Technically speaking, the second half of the day has not seen any changes. The US statistics could cause the pound to decline once more, but what FOMC members Michelle Bowman and Thomas Barkin have to say is considerably more intriguing. The pressure on the pound will probably lessen by the end of the week if we do not hear anything new from them, giving purchasers another opportunity to defend 1.1919. Due to this, I suggest you reconsider your purchases from the closest support level of 1.1919, but only after the emergence of a false breakout using the comparison I made above. This will serve as a signal to purchase the pound in anticipation of a rise to around 1.1974. I will wager on the continuation of the movement of the GBP/USD up to the maximum of 1.2022, which is just below where the moving averages are playing on the sellers’ side when fixing and testing this range from top to bottom. At 1.2070, where I fix profits, an exit above this level will also offer up growth potential. The pressure on GBP/USD will intensify if the bulls are unable to complete the tasks and miss 1.1919 in the afternoon, which in a bear market like this cannot be ruled out even at the end of the week. In this scenario, I suggest that you wait before making any purchases and only start long positions around the next support level of 1.1875 and only in the event of a false breakout. With the target of a fall of 30-35 points within the day, I will purchase GBP/USD as soon as it recovers just from 1.1829.
For opening short positions on the GBP/USD, you will need:
The pound’s sellers tried everything to keep the trend going, but they encountered enough resistance around 1.1919 that it might lead to profit-taking and a stronger upward movement later in the day. Because of this, protecting 1.1974 is a top priority, which in the present scenario would be a great indication to sell the pair. Growth and the development of a false breakout could result in the opening of short positions and the repeated movement of GBP/USD down to 1.1919. A break and reverse test of this area, together with hawkish comments from Federal Reserve System members that it is necessary to hike interest rates further, will cancel buyers’ plans to return to the market following yesterday’s selling, reinforcing bears’ presence in the market and producing a sell signal with a decline below 1.1875. The 1.1829 area will be the farthest target, and an update there will signal the continuation of the downward trend. I’ll set the profit there. Profit-taking may start at the end of the week given the possibility of GBP/USD growth and the lack of bears around 1.1974 in the afternoon. In this scenario, I suggest delaying sales until a false breakout occurs in the vicinity of the subsequent resistance level of 1.2022, which will serve as an entry opportunity for short positions. If there isn’t any activity, I’ll sell GBP/USD right away at its highest price of 1.2070, but only if I believe the pair will decline another 30-35 points during the day.
The CFTC has been experiencing a technical issue that has prevented the publication of new COT reports for more than two weeks. The most recent data is for January 24.
Both long and short positions were dramatically reduced in the COT report (Commitment of Traders) for January 24. But the present fall was within an acceptable range, particularly in light of the difficulties the UK government is currently facing as it battles strikes and demands for wage increases while also attempting to achieve a steady decline in inflation. Yet for the time being, all of this is receding into the background as we await the meetings of the Federal Reserve System, whose policy is anticipated to be less aggressive, and the Bank of England, whose pronouncements are certain to keep an aggressive tone by raising the rate by 0.5% once more. All of this will benefit the British pound, so I’ll wager on it strengthening even more, unless, of course, something extraordinary occurs. According to the most recent COT data, long non-commercial positions declined by 6,713 to 34,756, while short non-commercial positions decreased by 7,476 to 58,690, resulting in a fall in the non-commercial net position’s negative value to -23,934 from -24,697 a week earlier. We will continue to keep a careful eye on the economic indicators for the UK and the decision made by the Bank of England because such insignificant changes do not significantly alter the balance of power. In contrast to 1.2290, the weekly ending price increased to 1.2350.
Signals from indicators
Moving Averages
Trade is taking place below the 30- and 50-day moving averages, which suggests that sellers of the pound have returned to the market.
Note that the author’s consideration of the period and cost of moving averages on the hourly chart H1 differs from the standard definition of the traditional daily moving averages on the daily chart D1.
Bands by Bollinger
The indicator’s upper limit, which is located at 1.2022, will serve as resistance in the event of growth.
Description of indicators
The material has been provided by InstaForex Company – www.instaforex.com
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