GBP/USD: trading plan for the US session on September 11th (analysis of morning deals). Buyers of the pound are trying, but
September 11, 2023 2:22 pm
In my morning forecast, I drew attention to the level of 1.2541 and recommended making trading decisions based on it. Let’s look at the 5-minute chart and analyze what happened there. The pound’s rise continued after the Asian session, but the pair failed to reach 1.2541. For this reason, the technical picture was slightly revised for the second half of the day.
To open long positions on GBP/USD, the following is required:
Given the low volatility, likely to persist in the second half of the day, it is better not to rush into the market. The absence of US statistics will also affect the volume, so there is no need to count on a return of demand for the pair. In the case of a decline in GBP/USD, I plan to act against the bearish market only if a false breakout form at 1.2493 – the middle of the sideways channel, which will provide an entry point for buying with a subsequent recovery to 1.2535, a new resistance formed based on the results of the first half of the day. A breakout and consolidation above this range will restore confidence to buyers, giving a signal to buy with an exit at 1.2581. The more distant target is the area of 1.2626, where I will take profit. In the scenario of a decline and the absence of bulls at 1.2493 in the second half of the day, which is unlikely, the pressure on the pound will return, and the likelihood of further decline. In this case, only the defense of the next area at 1.2448 and a false breakout at that level will signal the opening of long positions. I plan to buy GBP/USD immediately on the rebound only from the minimum of 1.2419, with a 30-35 point intraday correction target.
To open short positions on GBP/USD, the following is required:
Bears need to defend the nearest resistance at 1.2535. Only after an unsuccessful consolidation at this level can a signal for selling with the prospect of a decline to the area of 1.2493 be obtained. A breakthrough and a reverse test from the bottom to the top of this range will deal a more serious blow to the bullish positions, providing an opportunity to update the monthly minimum at 1.2448. The more distant target remains the area of 1.2419, where I will take profit. In the scenario of GBP/USD rising and the absence of activity at 1.2535 in the second half of the day, which is more likely to happen, buyers will try to consolidate their advantage to build an upward correction further. In this case, I will postpone selling until a false breakout at 1.2581. If there is no downward movement, selling will only happen on a bounce from 1.2626, but only with the expectation of a pair’s correction downwards by 30-35 points.
In the COT report (Commitment of Traders) as of August 29, there was a decrease in long positions and an increase in short positions. Strong US labor market data and Federal Reserve Chairman Jerome Powell’s comments were the main reasons for a sharp increase in short positions on the pound. Considering that recently, there have been rather discouraging statistics from the UK indicating an impending recession, pressure on the pound is likely to persist this autumn. However, buyers may take advantage of this, as the lower the pound, the more attractive it becomes for medium-term purchases. The difference in central bank policies will continue to impact GBP/USD positively. In the latest COT report, it is stated that long non-commercial positions decreased by only 918 to the level of 97,143, while short non-commercial positions increased by 9,788 to 48,742. As a result, the spread between long and short positions increased by 124. The weekly price dropped to 1.2624 from 1.2741.
Indicator Signals:
Moving Averages
Trading is taking place above the 30 and 50-day moving averages, indicating an attempt by buyers to grasp the market.
Note: The author considers the period and prices of moving averages on the H1 hourly chart, which differs from the general definition of classic daily moving averages on the D1 daily chart.
Bollinger Bands
In case of a decline, the lower boundary of the indicator at around 1.2440 will act as support.
Description of Indicators:
• Moving average (determines the current trend by smoothing volatility and noise). Period 50. Marked on the chart in yellow.
• Moving average (determines the current trend by smoothing volatility and noise). Period 30. Marked on the chart in green.
• MACD Indicator (Moving Average Convergence/Divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9.
• Bollinger Bands. Period 20.
• Non-commercial traders – speculators, such as individual traders, hedge funds, and large institutions, using the futures market for speculative purposes and meeting 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.
• The net non-commercial position differs from non-commercial traders’ short and long positions.
The material has been provided by InstaForex Company – www.instaforex.com
In my morning forecast, I drew attention to the level of 1.2541 and recommended making trading decisions based on it. Let’s look at the 5-minute chart and analyze what happened there. The pound’s rise continued after the Asian session, but the pair failed to reach 1.2541. For this reason, the technical picture was slightly revised for the second half of the day.
To open long positions on GBP/USD, the following is required:
Given the low volatility, likely to persist in the second half of the day, it is better not to rush into the market. The absence of US statistics will also affect the volume, so there is no need to count on a return of demand for the pair. In the case of a decline in GBP/USD, I plan to act against the bearish market only if a false breakout form at 1.2493 – the middle of the sideways channel, which will provide an entry point for buying with a subsequent recovery to 1.2535, a new resistance formed based on the results of the first half of the day. A breakout and consolidation above this range will restore confidence to buyers, giving a signal to buy with an exit at 1.2581. The more distant target is the area of 1.2626, where I will take profit. In the scenario of a decline and the absence of bulls at 1.2493 in the second half of the day, which is unlikely, the pressure on the pound will return, and the likelihood of further decline. In this case, only the defense of the next area at 1.2448 and a false breakout at that level will signal the opening of long positions. I plan to buy GBP/USD immediately on the rebound only from the minimum of 1.2419, with a 30-35 point intraday correction target.
To open short positions on GBP/USD, the following is required:
Bears need to defend the nearest resistance at 1.2535. Only after an unsuccessful consolidation at this level can a signal for selling with the prospect of a decline to the area of 1.2493 be obtained. A breakthrough and a reverse test from the bottom to the top of this range will deal a more serious blow to the bullish positions, providing an opportunity to update the monthly minimum at 1.2448. The more distant target remains the area of 1.2419, where I will take profit. In the scenario of GBP/USD rising and the absence of activity at 1.2535 in the second half of the day, which is more likely to happen, buyers will try to consolidate their advantage to build an upward correction further. In this case, I will postpone selling until a false breakout at 1.2581. If there is no downward movement, selling will only happen on a bounce from 1.2626, but only with the expectation of a pair’s correction downwards by 30-35 points.
In the COT report (Commitment of Traders) as of August 29, there was a decrease in long positions and an increase in short positions. Strong US labor market data and Federal Reserve Chairman Jerome Powell’s comments were the main reasons for a sharp increase in short positions on the pound. Considering that recently, there have been rather discouraging statistics from the UK indicating an impending recession, pressure on the pound is likely to persist this autumn. However, buyers may take advantage of this, as the lower the pound, the more attractive it becomes for medium-term purchases. The difference in central bank policies will continue to impact GBP/USD positively. In the latest COT report, it is stated that long non-commercial positions decreased by only 918 to the level of 97,143, while short non-commercial positions increased by 9,788 to 48,742. As a result, the spread between long and short positions increased by 124. The weekly price dropped to 1.2624 from 1.2741.
Indicator Signals:
Moving Averages
Trading is taking place above the 30 and 50-day moving averages, indicating an attempt by buyers to grasp the market.
Note: The author considers the period and prices of moving averages on the H1 hourly chart, which differs from the general definition of classic daily moving averages on the D1 daily chart.
Bollinger Bands
In case of a decline, the lower boundary of the indicator at around 1.2440 will act as support.
Description of Indicators:
• Moving average (determines the current trend by smoothing volatility and noise). Period 50. Marked on the chart in yellow.
• Moving average (determines the current trend by smoothing volatility and noise). Period 30. Marked on the chart in green.
• MACD Indicator (Moving Average Convergence/Divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9.
• Bollinger Bands. Period 20.
• Non-commercial traders – speculators, such as individual traders, hedge funds, and large institutions, using the futures market for speculative purposes and meeting 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.
• The net non-commercial position differs from non-commercial traders’ short and long positions.
The material has been provided by InstaForex Company – www.instaforex.com
Related Posts: