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

In my morning forecast, I paid attention to the level of 1.3994 and recommended opening short positions from it. Let's look at the 5-minute chart and analyze the trades. The bulls are making an unsuccessful attempt to gain a foothold above the resistance of 1.3994, a return under which forms an excellent signal to open short positions in the continuation of the decline of the pound. However, it was not possible to reach the support of 1.3921, although it was not enough to test this level by about 3 points. Therefore, we can safely say that the signal worked at 100%. It was not possible to get an adequate entry point to long positions from the level of 1.3921, however, we will talk about this later.

From a technical point of view, nothing much has changed, except that the focus has shifted to the nearest support level. Although the data on manufacturing activity in the UK turned out to be better than economists' forecasts, we should not be too optimistic. To open long positions in the second half of the day, it is only best to wait for the formation of a false breakout in the support area of 1.3921 and then buy the pound. If there is no activity on the part of buyers in the area of 1.3921, I recommend postponing long positions until the test of the minimum of 1.3840, from which you can open long positions in GBP/USD immediately on the rebound, counting on an upward correction of 25-30 points within the day. The next level for buying is seen in the area of 1.3775. The nearest target where buyers will take profits will be the area of 1.3994. There are also moving averages that play on the side of sellers. A breakout and a test of this level from top to bottom (which we failed to do today in the first half of the day) forms a signal to buy GBP/USD to return to the resistance of 1.4062, where I recommend taking a profit. A more distant target will be the resistance of 1.4115.

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

The bears coped with the initial task. Now their goal is to break through and consolidate below the level of 1.3921. The test of this area on the reverse side forms a new signal to open short positions to further reduce the pair to the area of 1.3840, where I recommend taking the profits. The longer-range target will be a minimum of 1.3775. In the GBP/USD growth scenario in the second half of the day, it is best not to rush to sell but to wait for the formation of a false breakout in the area of 1.3994. Growth to this level will occur only in the case of very weak fundamental data on manufacturing activity in the United States. I recommend opening short positions immediately for a rebound only from the maximum of 1.4062, based on a downward correction of 30-35 points within the day.

Let me remind you that the COT reports (Commitment of Traders) for February 16 recorded a reduction in long and short commercial positions. Despite this, the bulls break through to new highs each time, taking advantage of the good news on vaccination in the UK and good fundamental data indicating economic growth even during the lockdown period. The news that in March this year, the UK will resort to easing quarantine measures, will continue to fuel interest in the British pound from investors. Long non-commercial positions fell only to the level of 60,269 from the level of 60,513. At the same time, the short non-profit declined from the level of 39,395 to 38,102, which kept the market bullish. As a result, the non-profit net position rose to 22,167 from 21,118 a week earlier. The weekly closing price was 1.3914 against 1.3745. Any downward corrections with an instant buy-off of the British pound once again prove the presence of major players in the market. The constant updating of local highs and consolidation on them will continue to contribute to the bullish trend that we have been observing since the beginning of February this year.

Signals of indicators:

Moving averages

Trading is below 30 and 50 daily averages, which indicates a continuation of the bear market in the short term.

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

Bollinger Bands

A break of the upper limit of the indicator in the area of 1.3994 will lead to a new wave of growth of the pair. A break of the lower limit of the indicator in the area of 1.3920 will increase the pressure on the pair.

Description of indicators

• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 50. The graph is marked in yellow.
• Moving average (moving average determines the current trend by smoothing out volatility and noise). Period 30. The graph is marked in green.
• MACD indicator (Moving Average Convergence / Divergence - moving average convergence / divergence) Fast EMA period 12. Slow EMA period 26. SMA period 9
• Bollinger Bands (Bollinger Bands). Period 20
• Non-profit 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.
• Short non-commercial positions represent the total short open position of non-commercial traders.
• Total non-commercial net position is the difference between the short and long positions of non-commercial traders.