GBP/USD 5M
The GBP/USD pair was trading very controversially on October 15. On the one hand, the movement during the day was quite good in strength, and, on the other hand, signals began to form when most of this movement had already passed. Thus, traders failed to extract profits on Friday. There were no macroeconomic reports in the UK on Friday, and reports from across the ocean did not cause any reaction from the markets, although they could have done it. But, as we've discussed in other articles, markets are now virtually ignoring all macroeconomic reports. Now let's take a look at trading signals and see if it was possible to profit from them. The first trading signal to sell was formed after the pair went up 60 points. The price bounced off the extremum level of 1.3732. Therefore, in this place, traders could open short positions. However, this signal turned out to be false, and a little later the price overcame the level of 1.3732 and resumed its upward movement. When it crossed the level of 1.3732, a buy signal was formed, which should also be worked out. However, this time too, the signal turned out to be false. The price returned to the level of 1.3732, bounced off it (at this time, traders should still be in long positions) and tried to continue the upward movement again. But again, it could not get to the nearest target level of 1.3785, so it was not possible to close a long position at Take Profit. Nevertheless, it was still possible to earn about 15 points of profit, since this deal had to be manually closed in the late afternoon. Thus, the total profit is zero.
GBP/USD 1H
The pound/dollar pair maintains an upward trend on the hourly timeframe and the overall picture looks much clearer. An uptrend line supports traders and clearly indicates the direction of the pair's movement. There are no signs of the end of the upward trend at this time. It will be possible to consider short positions on the current timeframe not earlier than the price settling below the trend line. We distinguish the following important levels on October 18: 1.3667, 1.3732, 1.3785 - 1.3794. Senkou Span B (1.3542) and Kijun-sen (1.3668) lines can also be sources of signals. It is recommended to set the Stop Loss level at breakeven when the price passes in the right direction by 20 points. The Ichimoku indicator lines can move during the day, which should be taken into account when looking for trading signals. On Monday, neither the United States nor the UK has a single important or interesting report scheduled. The report on industrial production cannot be considered as such, even at a stretch. Thus, today traders will have to trade on a clean technique, but there should be no problems with this, since the pound/dollar pair, unlike the euro/dollar pair, began to move more or less actively.
Recommended that you familiarize yourself:
Forecast and trading signals for EUR/USD for October 18. Detailed analysis of the movement of the pair and trade deals.
COT report
The mood of professional traders became less bearish again during the last reporting week (October 5-11). Major players closed 1,700 buy contracts (longs) and 10,600 sell contracts (shorts) during the week. Thus, the net position of professional traders has grown by almost 9,000, which is quite a lot for the pound. In principle, such a change in the mood of major players correlates well with how the pair moved during the same time period. The pound was growing, so it's reasonable to assume that the big players were buying it, not selling it. However, we are most interested in the general trend in COT reports. That is, how non-commercial traders behave over a long distance. And now let's look at the first indicator, especially at its movements over the past three months. The green and red lines (net positions of non-commercial and commercial traders) constantly change the direction of movement, cross each other, cross the zero mark. This suggests that there is no clear mood among the major players right now. It is constantly changing, which means there is no trend now. Moreover, if you look at the movements of the pair itself over the past 6-7 months, it is also clearly visible that the minimum downward trend is, of course, present, but still the quotes spent most of the time between the 36th level and the 42nd. That is, inside the horizontal channel. Thus, from our point of view, the Commitment of Traders (COT) reports now do not provide an opportunity to predict the pair's succeeding movement.
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.
