GBP/USD. October 4th. Isn’t it time for the dollar to stop?
October 4, 2023 11:22 amVideo
Latest News
- Analysis of GBP/USD on April 26th. The pound trades on Friday without changes April 26, 2024
- USD/JPY: Simple trading tips for novice traders on April 26th (US session) April 26, 2024
- GBP/USD: Simple trading tips for novice traders on April 26th (US session) April 26, 2024
- EUR/USD: Simple trading tips for novice traders on April 26th (US session) April 26, 2024
- GBP/USD: trading plan for the US session on April 26th (analysis of morning deals). The pound attempted, but it didn’t go April 26, 2024
- EUR/USD: trading plan for the US session on April 26th (analysis of morning deals). The euro continues to rise April 26, 2024
- Trading Signals for GOLD (XAU/USD) for April 26-29, 2024: buy above $2,324 and sell below $2,352 (21 SMA – 6/8 Murray) April 26, 2024
- Technical Analysis – AUDUSD set to complete best week of the year April 26, 2024
- Will Apple finally drop its AI hint? – Stock Markets April 26, 2024
- Bitcoin slips as markets pare back Fed rate cuts – Crypto News April 26, 2024
- EUR/USD. April 26th. Bulls continue to advance after the GDP report April 26, 2024
- Can Chinese PMIs solidify the economy’s recovery prospects? – Preview April 26, 2024
- Weekly Forex Outlook: 26/04/2024 – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too April 26, 2024
- XM’s Lombok Collaboration: Brightening Futures April 26, 2024
- Week Ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too April 26, 2024
- Market Comment – Yen keeps sinking after Bank of Japan decision April 26, 2024
- Fed faces dilemma amid sticky inflation and slowing economy – Preview April 26, 2024
- USD/JPY: trading tips for beginners for European session on April 26 April 26, 2024
- GBP/USD: trading tips for beginners for European session on April 26 April 26, 2024
- EUR/USD: trading tips for beginners for European session on April 26 April 26, 2024
On the hourly chart, the GBP/USD pair continued its downward movement towards the corrective level of 200.0%–1.2039 on Tuesday. A rebound from this level will allow us to count on a reversal in favor of the European currency and some growth towards the level of 1.2112. If the pair closes below the level of 1.2039, the probability of further decline towards the next level of 1.1883 will increase. The downward trend corridor continues to characterize the traders’ sentiment as “bearish,” which is clear even without it.
Since we did not see an increase in quotes yesterday, the wave situation has not changed by half a degree. The last wave is descending, and it has been forming for the fourth day in a row. The low of the previous wave has long been confidently broken, so at the moment, there are no signs of the end of the “bearish” trend. And in the near future (today or tomorrow), they are unlikely to appear.
The background information today will be quite interesting. In particular, in the US, the second report of the week related to the labor market will be released. Yesterday, the first report (JOLTS) turned out to be strong. If today’s ADP report on changes in non-farm employment also turns out to be stronger than forecasts, then we should expect a new strengthening of the US currency and the preservation of the “bearish” trend.
Ahead of us, there are also reports on nonfarm payrolls and unemployment (on Friday), and today is the ISM Business Activity Index for the non-manufacturing sector. All these reports will have an impact on the US dollar exchange rate. By logic, the situation with the labor market and within the US economy should gradually deteriorate, but so far, these deteriorations are too insignificant and cannot overshadow the positive effect for the dollar from the high FOMC interest rates.
On the 4-hour chart, the pair has executed a new reversal in favor of the American currency and resumed its downward movement towards the level of 1.2008. At the moment, a new “bullish” divergence is looming for the RSI indicator, which once again allows us to count on some growth in the pair. A rebound of quotes from 1.2008 will also work in favor of the British currency and the beginning of growth. Closing below 1.2008 will increase the probability of further decline towards the next corrective level of 38.2% (1.1832).
Commitments of Traders (COT) Report:
The sentiment of the “non-commercial” trader category became less “bullish” again over the past reporting week. The number of long contracts held by speculators decreased by 345 units, while the number of short contracts increased by 17,669 units. The overall sentiment of major players remains bullish, and the gap between the number of long and short contracts is narrowing every week: already 85,000 versus 69,000. In my opinion, the British pound had good prospects for further growth two months ago, but now many factors have turned in favor of the US dollar. I do not expect a strong pound rally in the near future. I believe that over time, bulls will continue to unwind their buy positions, as is the case with the European currency.
News Calendar for the US and the UK:
UK – Services Sector Business Activity Index (08:30 UTC).
USA – ADP Non-Farm Employment Change (12:15 UTC).
USA – S&P Global Services PMI (13:45 UTC).
USA – ISM Non-Manufacturing Purchasing Managers’ Index (14:00 UTC).
Wednesday’s economic events calendar includes several important entries, with ADP and ISM standing out. The impact of the information backdrop on market sentiment today may be of moderate strength.
EUR/USD forecast and tips for traders:
Selling the British pound was possible on a rebound from the level of 1.2250, with targets at 1.2175, 1.2112, and 1.2039 on the hourly chart. All targets have been reached. Closing below the level of 1.2039 would allow for keeping them open with a target of 1.1883. I recommend considering buying in case of a rebound from the level of 1.2039, with targets at 1.2112 and 1.2175.
The material has been provided by InstaForex Company – www.instaforex.com
Related Posts: