GBP/USD 5M

The GBP/USD currency pair also tried to recover on Monday. And from the fall last week, and from the fall on Monday night. We can't say that it succeeded, the quotes are still much lower than the levels of the beginning of last week. Macroeconomic background does not affect the pair's movements. Only geopolitics. The pound has collapsed twice and can do it as many times as necessary, as long as the geopolitical conflict in Eastern Europe continues to worsen. Thus, now everything really depends on geopolitics.

There were few trading signals during today. All of them were formed near the level of 1.3367. Unfortunately, today was an unsuccessful trading day, as the first two signals turned out to be blatantly false, so the third, profitable signal, should no longer be worked out. Thus, a small loss was received for the first two transactions, and the third signal was not worked out. Unfortunately, the market continues to be in an unusual state for itself, so illogical movements are possible, as on Monday. If the overnight collapse could still be somehow predicted because of all the news on Saturday and Sunday, then further recovery is already quite difficult.

COT report:

The latest Commitment of Traders (COT) report on the British pound showed an increase in the bearish mood among professional traders. Last week, for the first time in several months, the number of long positions from the non-commercial group exceeded the number of short positions, but this picture was not observed for long. This week it already became known that non-commercial traders started closing longs again and their total number fell to 44,000, while the total number of shorts remained at 48,000. Thus, formally, the mood among the major players is bearish now. However, all events of a geopolitical nature were not included in the latest COT report. That is, the next COT report may show a much stronger change in the net position of each group of traders and a sharp change in mood. In addition, the first indicator in the chart above shows that the mood of commercial and non-commercial traders is now essentially "neutral", since both lines (red and green) are near zero. Thus, although in recent months there has been a tendency to reduce short positions and build up long ones, now there is a complete balance in the market, and geopolitics can affect the balance of power and may affect it in the next few weeks/months. Therefore, no conclusions can be drawn based on COT reports now. Or it doesn't make sense. Unfortunately, the whole world is in tension right now, and comprehensive sanctions will affect the global economy and the mood of traders and investors.

We recommend to familiarize yourself with:

Overview of the EUR/USD pair. March 1. The markets experienced a shock. It's time to calm down and return to the usual trading mode.

Overview of the GBP/USD pair. March 1. The British pound also got into a "storm" on Monday. Boris Johnson proposes to tighten sanctions against Russia.

Forecast and trading signals for EUR/USD on March 1. Detailed analysis of the movement of the pair and trading transactions.

GBP/USD 1H

The technical picture on the hourly timeframe has changed dramatically in just a day. At the moment, the pair is trapped in a triangle and overcoming any of its boundaries can help determine the further direction of movement. We are inclined to believe that the pound will continue to fall one way or another. But everything will depend on geopolitics, new sanctions from both sides of the conflict. We highlight the following important levels: 1.3170-1.3185, 1.3276, 1.3367, 1.3439, 1.3489, 1.3537, 1.3572. The Senkou Span B (1.3564) and Kijun-sen (1.3446) lines can also be signal sources. Signals can be "bounces" and "breakthroughs" of these levels and lines. It is recommended to set the Stop Loss level to breakeven when the price passes in the right direction by 20 points. The lines of the Ichimoku indicator can move during the day, which should be taken into account when determining trading signals. There are support and resistance levels in the chart that can be used to take profits on transactions. The UK and the US are scheduled to publish business activity indices in the manufacturing sectors on Tuesday. At the moment, this is not the most important data and they are likely to be ignored by the market. Nevertheless, the pair may continue to move quite volatile, especially if the strong geopolitical background continues to arrive.

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.