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The EUR/USD pair sharply grew on Thursday. It wasn't exactly predictable, but it was not illogical either. The first factor to consider is that the pair had been declining over the past month, indicating an impending upward correction. Furthermore, Thursday's macroeconomic backdrop could be interpreted in different ways.   The correlation between inflation and the European Central Bank's rates no longer exists, so a more significant slowdown in the EU Consumer Price Index did not trigger a decline in the euro, as it might have a few months ago. We can consider ECB President Christine Lagarde's speech as "moderately hawkish," and the minutes of the recent ECB meeting revealed that several members of the monetary committee supported a 0.5% rate hike in May. Thus, the euro had the right to grow.       There were an adequate number of trading signals, and since the movement was good and there was a trend-driven movement, it is not surprising for traders to gain profit. Initially, the pair bounced from the level of 1.0669 (a buy position should have been opened), then surpassed a critical line (supporting the trade), and finally reached the level of 1.0762 (where profit should have been taken). As a result, you could earn 85 pips. Such opportunities have been rare lately due to the lack of normal intraday trends.     The COT report for May 23 was delivered on Friday. Over the past nine months, COT data has been in line with developments in the market. The net position (second indicator on the chart) has been on the rise since September 2022. The euro started to show strength approximately at the same time. Currently, the net non-commercial position is bullish and keeps growing further. Likewise, the euro is bullish. Notably, we may assume by the extremely bullish net position that the uptrend may soon stop.   The first indicator shows that, and the red and green lines are far away from each other, which is usually a sign that the end of the trend might be nearing. The euro attempted to go down several months ago, but those were just minor pullbacks. In the reporting week, long positions of non-commercial traders decreased by 8,600 and short positions rose by 4,700. The net position dropped by 13,300. The number of long positions exceeds that of short ones by 174,000, a rather big gap. A correction or a new downtrend has started. So, it is clear that the pair will be bearish even without COT reports.     The COT report for May 23 was delivered on Friday. Over the past nine months, COT data has been in line with developments in the market. The net position (second indicator on the chart) has been on the rise since September 2022. The euro started to show strength approximately at the same time. Currently, the net non-commercial position is bullish and keeps growing further. Likewise, the euro is bullish. Notably, we may assume by the extremely bullish net position that the uptrend may soon stop.   The first indicator shows that, and the red and green lines are far away from each other, which is usually a sign that the end of the trend might be nearing. The euro attempted to go down several months ago, but those were just minor pullbacks. In the reporting week, long positions of non-commercial traders decreased by 8,600 and short positions rose by 4,700. The net position dropped by 13,300. The number of long positions exceeds that of short ones by 174,000, a rather big gap. A correction or a new downtrend has started. So, it is clear that the pair will be bearish even without COT reports.     Indicators on charts: Resistance/support - thick red lines, near which the trend may stop. They do not make trading signals. Kijun-sen and Senkou Span B are the Ichimoku indicator lines moved to the hourly timeframe from the 4-hour timeframe. They are also strong lines. Extreme levels are thin red lines, from which the price used to bounce earlier. They can produce trading signals. Yellow lines are trend lines, trend channels, and other technical patterns. Indicator 1 on the COT chart is the size of the net position of each trader category. Indicator 2 on the COT chart is the size of the net position for the Non-commercial group of traders.  

The GBP/USD pair has hit 61% Fibonacci retracement level on the weekly time frame chart located at 1.2778 and so far the price was rejected from that level. This is the line in sand for bears as any breakout higher would be considered even more bullish. So far the monthly high was made at the level of 1.2847. On the lower time frames, like H4, the intraday technical support is seen at the level of 1.2712 and 1.2698. The momentum hit the level of fifty, so it is neutral, but the there is still a chance for the price to move lower towards the technical supports. Please notice, the price was rejected from the 50 MA on H4 time frame chart already.      

The EUR/USD pair had made higher high at the level of 1.0971, so the bulls are still in control of the market and then started a pull-back. The price break below the 50 MA around the level of 1.0917 and now the bulls are trying to resume the up move again.   The next target for bulls is seen at the level of 1.1007 and the intraday technical support is seen at 1.0917 and 1.0905. The momentum is coming off the extremely overbought levels, heading towards the neutral level of fifty on the RSI (14) indicator. Please expect bears to defend the supply zone located between the levels of 1.1006 - 1.0999.  

The EUR/USD pair has been seen moving higher on the daily time frame as there is still a room on the RSI indicator before it hits the extremely overbought market conditions. The next target for bulls is seen at the level of 1.1054 - 1.1097, which creates a supply zone for bears. The intraday technical support is located at 1.0971 and 1.0873. The bulls are clearly in control of the market and there is no indication of a up trend termination or reversal.      

Yesterday, the pair formed several good signals to enter the market. Let's analyze what happened on the 5-minute chart. In my morning review, I mentioned the level of 1.0870 as a possible entry point. Growth and false breakout of this level generated a sell signal, and the pair fell by more than 60 pips. During the US session, safeguarding the support level at 1.0808 and weak US data produced a buy signal. As a result, EUR/USD managed to compensate for all morning losses and rose by more than 50 pips.   For long positions on EUR/USD: Softer-than-expected preliminary US PMI data exerted downward pressure on the dollar and the euro strengthened in the second half of the day. Obviously, there's a lot of market manipulation, making the situation increasingly tense before the Jackson Hole symposium. Yesterday's data made it clear: if the Federal Reserve continues its tight policy stance, the economic situation will only worsen. This has further confused market participants, who were expecting hawkish statements from Fed Chair Jerome Powell. In the absence of EU reports in the first half of the day, I expect EUR/USD to trade within the channel. Therefore, it is advisable to trade on a dip following a false breakout near the low of 1.0849, which is in line with the bullish moving averages. An immediate resistance target is set at 1.0889, formed on Tuesday.   A breakout and a downward test of this range will strengthen demand for the euro, suggesting a bullish correction around 1.0928. The ultimate target is found at 1.0958, where I will be locking in profits. If EUR/USD declines and bulls are idle at 1.0849, the bear market will persist. Only a false breakout around the next support at 1.0827 will signal to buy the euro. I will initiate long positions immediately on a rebound from the low of 1.0804, aiming for an upward correction of 30-35 pips within the day.   For short positions on EUR/USD: The sellers lost all their advantage yesterday and now they need to start from the beginning. Today, to maintain the bearish momentum, sellers will have to assert their strength at the new resistance of 1.0889. The pair may test this level soon. The absence of economic reports will help the bears with a false breakout of this level and will lead to another descent towards the 1.0849 support. However, only a breakout below this range, followed by an upward retest, will generate another sell signal, paving the way to the low of 1.0827, where I expect big buyers to emerge in hopes of building the lower band of the new ascending channel. The ultimate target is seen at 1.0804, where I will be locking in profits. If EUR/USD moves upward during the European session and lacks bearish activity at 1.0889, the bulls may try to re-enter the market. In such a scenario, I would go short only when the price tests the new resistance at 1.0928 that was formed yesterday. Selling at this point is possible only after a failed consolidation. I will initiate short positions immediately on a rebound from the high of 1.0958, considering a downward correction of 30-35 pips within the day.     COT report: The COT (Commitment of Traders) report for August 15 shows a notable increase in long positions and a drop in short positions. These figures already factor in the crucial US inflation data, which brought back some buyers to the market. The Federal Reserve meeting minutes released last week also indicated that not all committee members are aligned with the idea of raising interest rates to combat inflation. This keeps the chances of the euro's recovery alive, especially following the Jackson Hole symposium happening later this week where Federal Reserve Chairman Jerome Powell is scheduled to speak. His address might shed light on the central bank's future policy direction. It is important to note that the recent decline in the euro seems to be appealing to traders. The optimal medium-term strategy under current conditions remains buying risk assets on a dip. The COT report highlights that non-commercial long positions increased by 4,418 to stand at 232,466, while non-commercial short positions decreased by 5,634 to 72,603. Consequently, the spread between long and short positions surged by 1,125. The closing price was lower, settling at 1.0922 compared to 1.0981 the previous week.     Indicator signals: Moving averages: Trading is taking place around the 30-day and 50-day moving averages, indicating market uncertainty. Please note that the time period and levels of the moving averages are analyzed only for the H1 chart, which differs from the general definition of the classic daily moving averages on the D1 chart. Bollinger Bands If EUR/USD declines, the indicator's lower border near 1.0825 will serve as support.   Description of indicators: • A moving average of a 50-day period determines the current trend by smoothing volatility and noise; marked in yellow on the chart; • A moving average of a 30-day period determines the current trend by smoothing volatility and noise; marked in green on the chart; • MACD Indicator (Moving Average Convergence/Divergence) Fast EMA with a 12-day period; Slow EMA with a 26-day period. SMA with a 9-day period; • Bollinger Bands: 20-day period; • Non-commercial traders are speculators such as individual traders, hedge funds, and large institutions who use the futures market for speculative purposes and meet certain requirements; • Long non-commercial positions represent the total number of long positions opened by non-commercial traders; • Short non-commercial positions represent the total number of short positions opened by non-commercial traders; • The non-commercial net position is the difference between short and long positions of non-commercial traders.