The GBP/USD pair finally moved the way it should on September 23. During the day, the price passed more than 130 points and this is a normal value for the pound/dollar pair. In addition, several very good trading signals were generated at once, and the price was moving in one direction almost all day. Moreover, the trading signals did not coincide with the most important fundamental events of the day, which allowed traders to show flexibility and not leave open trades. But first things first. The first buy signal was formed at the beginning of the European trading session - the quotes overcame the extremum level of 1.3640. Therefore, traders should have taken long positions. A little later, data on business activity in the UK (figure "1" in the chart) were published, which turned out to be much worse than forecasted and provoked a slight drop in the pound's quotes. But this did not affect the general movement in any way. Quotes continued to rise, and by the US trading session, the pair reached and crossed the critical line. About an hour earlier, the Bank of England announced the results of its meeting (figure "2" in the chart), which we discussed in detail in the fundamental review for GBP/USD, after which the upward movement only intensified. Therefore, traders did not need to leave long positions. It was only necessary to set Stop Loss to breakeven. US reports (numbers "3" and "4" in the chart) had no effect at all on the pair's movements, so the quotes safely reached the extremum level of 1.3732 and overcame it. A long position could have already been closed above this level (in the late afternoon). The profit on it was 88 points. The pound paid tribute to traders for all the previous bad days. Not a single sell signal was generated during the day.
The GBP/USD pair finally moved the way it should on September 23. During the day, the price passed more than 130 points and this is a normal value for the pound/dollar pair. In addition, several very good trading signals were generated at once, and the price was moving in one direction almost all day. Moreover, the trading signals did not coincide with the most important fundamental events of the day, which allowed traders to show flexibility and not leave open trades. But first things first. The first buy signal was formed at the beginning of the European trading session - the quotes overcame the extremum level of 1.3640. Therefore, traders should have taken long positions. A little later, data on business activity in the UK (figure "1" in the chart) were published, which turned out to be much worse than forecasted and provoked a slight drop in the pound's quotes. But this did not affect the general movement in any way. Quotes continued to rise, and by the US trading session, the pair reached and crossed the critical line. About an hour earlier, the Bank of England announced the results of its meeting (figure "2" in the chart), which we discussed in detail in the fundamental review for GBP/USD, after which the upward movement only intensified. Therefore, traders did not need to leave long positions. It was only necessary to set Stop Loss to breakeven. US reports (numbers "3" and "4" in the chart) had no effect at all on the pair's movements, so the quotes safely reached the extremum level of 1.3732 and overcame it. A long position could have already been closed above this level (in the late afternoon). The profit on it was 88 points. The pound paid tribute to traders for all the previous bad days. Not a single sell signal was generated during the day.
The GBP/USD pair did not gain or lose a single point during the last reporting week (September 7-13). Recall that in recent weeks, according to Commitment of Traders (COT) reports, the mood of the major players has changed to bearish. The green line of the first indicator in the chart above (denotes a change in the net position of the "non-commercial" group) has dropped below zero. This was until the last COT report, which came out on Friday, September 17th. At that time, we already questioned the continuation of the British currency's decline. Simply because the pound, like the euro, has been correcting for more than six months against the global upward trend. And during this time, it managed to correct by 23.6%. This is very small and certainly does not look like a new downward trend is forming. And the latest COT report did show that any expectations of further dollar growth may be premature. Despite the fact that at the end of the week the dollar rose against both the pound and the euro, during the reporting week, major players immediately opened 15,000 buy contracts (longs) and closed the same number of sell contracts (shorts). That is, the net position for the "non-commercial" group of traders has grown by 30,000 at once. Considering that until the last COT report, only 30,000 buy contracts (longs) were opened for commercial traders, such changes are global. Thus, in the case of the pound, the chances of a further fall are much less than with the euro. Moreover, both the pound and the euro have corrected against the upward trend by 600 points. But it is less than 23% for the pound, and it is about a third for the euro.
