empty
 
 

Forex Analysis & Reviews: GBP/USD: plan for the European session on November 27. COT reports. Pound keeps pushing in the channel
time 27.11.2020 08:57 AM
time Relevance up to, 28.11.2020 07:40 AM

To open long positions on GBP/USD, you need:

In yesterday's morning forecast, I advised you to open short positions when a false breakout is formed in the resistance area of 1.3395, which is what happened. If you look at the 5-minute chart, you will see how the bulls made an unsuccessful attempt to rise above the 1.3395 level, afterwards a signal to sell the pound appeared, which pulled down the pair to the support area of 1.3354, where the downward trend initially stopped. The bears broke through this range in the afternoon, and testing it from the bottom up formed an additional entry point for short positions, as a result of which the downward movement was about 35 points. But the bulls managed to regain control of the 1.3354 level towards the end of the US session, which led to forming a horizontal channel.

This image is no longer relevant

And although we do not expect any news regarding Brexit today, the pound's succeeding direction still depends on it. Also, the direction can be determined by support at 1.3354, which will be emphasized in the morning. A false breakout on it produces a good entry point into long positions while aiming to return to the weekly high of 1.3395. Serious problems may arise with the pound's succeeding growth if this level is not updated. Let me remind you that quite recently, the president of the European Commission said that so far there has been no progress in the talks, and the chief negotiator from the EU side, Michel Barnier, noted his readiness to withdraw from negotiations if the UK does not make concessions. Being able to settle above the 1.3395 level and testing it from top to bottom provides a fairly good signal for buying GBP/USD in order for it to rise to the 1.3453 area. The next target will be a high of 1.3509, where I recommend taking profits. In case the pound falls in the first half of the day and it is not active around 1.3354, it is best to postpone long deals until the lower limit of the 1.3305 horizontal channel has been updated, in which the pair has been staying this whole week. You can buy the pound there immediately on a rebound, counting on an upward correction of 15-20 points.

To open short positions on GBP/USD, you need:

The bears are still looking to regain control over the 1.3354 level, which they missed in today's Asian session. Only its breakout and being able to settle below, similar to the entry point into short positions that I analyzed above, will return new large sellers to the market, which will quickly pull down GBP/USD to the lower limit of the 1.3305 horizontal channel, where I recommend taking profit. We can talk about bringing back the bear market only when we have gone beyond 1.3305, which will lead to removing a number of buyers' stop orders and the pair's fall to a low of 1.3251. If bulls make another attempt to break through the monthly highs in the first half of the day, then I recommend considering new short positions only after forming a false breakout at the 1.3395 level. In the absence of activity there, it is best to refuse to sell until a new high in the 1.3453 area has been updated, where you can sell the pound immediately on a rebound, counting on a correction of 20-30 points within the day.

This image is no longer relevant

The Commitment of Traders (COT) reports for November 17 saw a reduction in long positions and a sharp inflow of short positions. Long non-commercial positions declined from 27,872 to 27,454. At the same time, short non-commercial positions increased from 45,567 to 47,200. As a result, the negative non-commercial net position was -19,746 against -17,695 a week earlier, which indicates that the sellers of the British pound retains control and also shows their slight advantage in the current situation. Lack of clarity on the trade deal, together with the lockdown of the British economy in November, clearly does not add optimism and confidence to buyers of the pound.

Indicator signals:

Moving averages

Trading is carried out in the area of 30 and 50 moving averages, which indicates uncertainty regarding the pound's succeeding direction.

Note: The period and prices of moving averages are considered by the author on the H1 hourly chart and differs from the general definition of the classic daily moving averages on the D1 daily chart.

Bollinger Bands

A breakout of the upper border of the indicator around 1.3368 will lead to a new wave of growth for the pound. In case the pair falls, support will be provided by the lower border at 1.3333.

Description of indicators

  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 50. It is marked in yellow on the chart.
  • Moving average (moving average, determines the current trend by smoothing out volatility and noise). Period 30. It is marked in green on the chart.
  • MACD indicator (Moving Average Convergence/Divergence — convergence/divergence of moving averages) Quick EMA period 12. Slow EMA period to 26. SMA period 9
  • Bollinger Bands (Bollinger Bands). Period 20
  • Non-commercial speculative traders, such as individual traders, hedge funds, and large institutions that use the futures market for speculative purposes and meet certain requirements.
  • Long non-commercial positions represent the total long open position of non-commercial traders.
  • Non-commercial short positions represent the total short open position of non-commercial traders.
  • Total non-commercial net position is the difference between short and long positions of non-commercial traders.
Miroslaw Bawulski,
Analytical expert of InstaForex
© 2007-2022
Benefit from analysts’ recommendations right now
Top up trading account
Open trading account

InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.

  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • Ferrari from InstaForex
    Top up your account with at least $1,000
    join the contest and win Ferrari
    F8 Tributo
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and win $1,000
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS

Recommended Stories

How to trade GBP/USD on December 6. Simple trading tips and analysis for beginners

GBP/USD did not trade any better than EUR/USD on Monday. Iit managed to change its direction three times during the day. Of course, there were quite a lot of macroeconomic

Paolo Greco 22:44 2022-12-05 UTC+2

How to trade EUR/USD on December 6. Simple trading tips and analysis for beginners

EUR/USD showed turbulent and erratic movements on Monday. However, there were at least some reasons to trade that way. Many different reports were scheduled for Monday in the European Union

Paolo Greco 22:44 2022-12-05 UTC+2

NZD/USD Technical Analysis and Trading Tips for December 5, 2022

Today, NZD/USD has broken through the key resistance levels 0.6310 (50 EMA on the weekly chart) and 0.6235 (200 EMA on the daily chart) and continues to move towards resistance

Jurij Tolin 14:25 2022-12-05 UTC+2

EUR/USD: trading plan for North American session on December 5. Overview of morning trades. Euro edges lower on weak PMI reports

In my previous analytical review, I drew your attention to the level of 1.0537 and recommended entering the market from it. Let's have a look at the 5-minute chart

Miroslaw Bawulski 12:29 2022-12-05 UTC+2

GBP/USD: trading plan for American session on December 5. Overview of morning trades. GDP to slide in downward correction

In the morning article, I turned your attention to the levels of 1.2316 - 1.2261 and recommended making decisions with these levels in focus. Now, let's look at the 5-minute

Miroslaw Bawulski 12:23 2022-12-05 UTC+2

Trading plan for EURUSD on December 05, 2022

EURUSD rose through fresh swing highs at 1.0584 during the early Asian session on Monday, barely a few pips away from 1.0600 as projected earlier. The single currency pair

Oscar Ton 11:15 2022-12-05 UTC+2

Trading tips for oil

Market players reacted positively to the price cap that was imposed over the weekend. This, along with the three-wave pattern (ABC) in oil, opens the opportunity for traders to enter

Andrey Shevchenko 10:46 2022-12-05 UTC+2

EUR/USD and GBP/USD: trading plan for beginners on December 5

The highlight of the last week was certainly the report by the US Labor Department. Oddly, its content aroused more questions than joy. Basic details: The unemployment rate remained flat

Gven Podolsky 09:44 2022-12-05 UTC+2

GBP/USD: trading plan for European session on December 5. GBP conquers 1-month peak

On Friday, the currency pair formed the only signal for market entry. Now let's look at the 5-minute chart and try to figure out what actually happened. In the previous

Miroslaw Bawulski 07:43 2022-12-05 UTC+2

EUR/USD trading plan for European session on December 5, 2022. COT report and overview of Friday's trade. EUR gaining ground despite strong US jobs data

On Friday, the pair formed several good signals for entering the market. Let's see what happened on the 5-minute chart. In my previous review, I pointed out the level

Miroslaw Bawulski 07:26 2022-12-05 UTC+2
Can't speak right now?
Ask your question in the chat.