Interesting The GBP/USD Pair's Movement

The GBP/USD Pair Did Not Reach The Nearest Target Level Of 1.2259

GBP/USD 5M

Exchange Rates 02.09.2022 analysis

The GBP/USD currency pair continued to fall on Thursday, as if there were no other options for movement in principle. However, nothing can be done about this behavior of the market. The descending trend line continues to be relevant, therefore, from a technical point of view, everything is logical: there is a trend, there is a movement corresponding to the trend. The price is already far beyond the latest high at 1.1649, below which is only 1.1411, which is a 37-year low. Therefore, there are very few levels at which one could trade now. The Ichimoku indicator lines are also very far from the price. There were no macroeconomic statistics in the UK not only on Thursday, but throughout the current week. It is hardly worth even paying attention to the index of business activity in the services sector in the second assessment for August. The US ISM Services PMI is more important, but yesterday it stood at 52.8, which is in line with the month of July. As a result, there was no reaction, and the pound has to go down about 100 points in order to update its lows for four decades.

In regards to Thursday's trading signals, everything was just utterly impossible - not a single signal was formed. We have already said that there are no levels or lines in the area of the current location of the price, so the signals are simply not due to what to form. Unfortunately, a rather strong movement was missed yesterday.

COT report:

The latest Commitment of Traders (COT) report on the British pound turned out to be quite interesting. During the week, the non-commercial group opened 14,700 long positions and 9,500 short positions. Thus, the net position of non-commercial traders increased immediately by 5,200. Despite the growth of this indicator for several months now, the mood of the big players still remains "pronounced bearish", which is clearly seen in the second indicator in the chart above (purple bars below zero = bearish mood). To be fair, in recent months the net position of the non-commercial group has been constantly growing, but the pound shows only a very weak tendency to rise. And even then, only from time to time. And now its fall has resumed altogether, so the bearish mood of major players may again begin to intensify in the near future. The non-commercial group now has a total of 86,000 short positions and 58,000 long positions open. The difference is no longer as daunting as it was a few months ago, but it's still there. The net position will have to show growth for a long time to at least equalize these figures. Moreover, COT reports are a reflection of the mood of major players, and their mood is influenced by the "foundation" and geopolitics. If they continue to be as disappointing as they are now, then the pound may still be on the "downward peak" for a long time. We should also remember that the demand for the pound is not the only thing that matters, but also the demand for the dollar, which seems to remain very strong. Therefore, even if the demand for the British currency grows, if the demand for the dollar grows at a higher rate, then the pound will not strengthen.

We recommend to familiarize yourself with:

Overview of the EUR/USD pair. September 2. The euro has nothing to hope for and nowhere to expect help.

Overview of the GBP/USD pair. September 2. The pound continues to slide downhill.

Forecast and trading signals for EUR/USD on September 2. Detailed analysis of the movement of the pair and trading transactions.

GBP/USD 1H

The pound/dollar pair maintains a downward trend on the hourly timeframe thanks to the trend line. The British currency continues to fall and may continue for some time, as the market seems to have forgotten that it can not only press the "sell" button. The market does not need any specific grounds for trading now, and the pound is updating its lows almost every day. We highlight the following important levels for September 2: 1.1411, 1.1649, 1.1874, 1.1974, 1.2007. The Senkou Span B (1.1928) and Kijun-sen (1.1699) lines can also be sources of signals. Signals can be "rebounds" and "breakthroughs" of these levels and lines. The Stop Loss level is recommended to be set to breakeven when the price passes in the right direction by 20 points. Ichimoku indicator lines can move during the day, which should be taken into account when determining trading signals. The chart also contains support and resistance levels that can be used to take profits on trades. No interesting events planned in the UK again on Friday. The most important NonFarm Payrolls report will be published in the US, which can provoke a very strong market reaction. Traders will direct their attention on it.

Explanations for the chart:

Support and Resistance Levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Kijun-sen and Senkou Span B lines are lines of the Ichimoku indicator transferred to the hourly timeframe from the 4-hour one.

Support and resistance areas are areas from which the price has repeatedly rebounded off.

Yellow lines are trend lines, trend channels and any other technical patterns.

Indicator 1 on the COT charts is the size of the net position of each category of traders.

Indicator 2 on the COT charts is the size of the net position for the non-commercial group.

 

Relevance up to 02:00 2022-09-03 UTC+2 Company does not offer investment advice and the analysis performed does not guarantee results. The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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The GBP/USD Pair Did Not Reach The Nearest Target Level Of 1.2259

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