Hourly chart of the GBP/USD pair

The technical picture for the GBP/USD pair is getting more complicated day by day. Since the pair's quotes also failed to overcome their previous local high of 1.3169, we expect the pound to fall in the near future. Nevertheless, market participants have been buying the pair in recent days, which even led to forming a short-term upward trend, which is indicated by an upward channel in the illustration. At the same time, we do not advise trading the pound/dollar pair upwards now, as well as for the euro. The likelihood that traders will no longer actively buy the pound around five-month highs is too great, which itself is one of the most problematic and weak currencies in the last four years. Be that as it may, it will be possible to consider buying but not before the 1.3167 level has been overcome. As for selling, for these trades, we advise you to wait for the price to close below the rising channel.

Fundamentally, novice traders had something to look out for on Tuesday. For once, several important macroeconomic publications have been published in the UK. The most interesting - the unemployment report - turned out to be much better than the forecast values and reached 3.9%. In fact, unemployment has not increased from the very beginning of the pandemic and the coronavirus crisis in Britain. What is it? Correct government action? An effective stimulus program from the Bank of England that saved the British from cuts? One way or another, but the pound really had reasons for growth on Tuesday. The other two reports were less rosy, but they were also less significant. Wages slightly fell in June and jobless claims were higher than traders expected.

On Wednesday, novice traders are advised to pay attention to the report on GDP for the second quarter, since this is the most important report for the day. It is expected that the GDP would fall 20.2% compared to the first quarter as a result of the coronavirus crisis, which was also negative. We believe that this information may put pressure on the pound's position, since this is the largest drop in GDP in the country over the past 100 years. A greater economic contraction in the second quarter has only been found in the United States, but the market has already worked out this data. A report on industrial production will also be released tomorrow, which has already begun to recover after quarantine and could grow by 9.2% in June compared to May.

The following scenarios are possible on August 12:

1) Despite the fact that the pound/dollar pair resumed its upward movement, we believe that buying around five-month highs is not the wisest decision. Nevertheless, if the price manages to close for an hour above the 1.3167 level, which passes through the last two peaks of the price, this will be a signal for new small purchases.

2) Selling, from our point of view, can be considered if the price manages to gain a foothold below the upward channel in which it is trading right now. In this case, sellers may again try to bring the pair to the levels of 1.3024 and 1.2979. Most likely, the MACD indicator in this case will be automatically directed downward. This signal can also be formed at night, which is somewhat inconvenient in terms of accompanying an open deal.

What's on the chart:

Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.

Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.

MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners in the forex market should remember that every trade cannot be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.