The GBP/USD pair quickly recovered from Jerome Powell's speech on Tuesday and returned to the sideways channel between 1.3276 and 1.3362. The quotes left this channel twice, so it is difficult to say whether this channel is strong or not. However, the pair spent most of the last six days trading inside it. Therefore, we can conclude that the pound continues to trade in a sideways channel, and traders are trying to leave it without much success. Since this channel is not very strong, a signal of consolidation below it can hardly be regarded as a strong sell signal. But the breakout of the upper boundary of the channel, where the pair has bounced off 4 times already, can be a strong buy signal. There was nothing interesting in terms of fundamental events and macroeconomic news on Thursday, neither in the UK nor in the US. Although the pair was not stuck in one place during the day, its movements were very stiff. The volatility of the day was only about 60 pips.
On the 5-minute time frame, the movement of the pound/dollar pair was very moderate on Thursday. During the day, only one buy signal was generated when the price bounced off the 1.3276 level. Novice traders could follow this signal because it was surprisingly accurate and clear. After the signal had been formed around 1.3293, the pair went up by about 40 pips, which was enough to trigger the minimum Take Profit. Therefore, it was possible to gain profit from the only trade of the day. The price did not test any of the levels again. As of today, the price can still test the level of 1.3333 which is the high of the day. On Friday, we can use it to search for trading signals.
Trading tips on Friday
Currently, we can observe a sideways channel on the 30-minute time frame. So, there is a clear flat movement on the chart. However, the situation may change on Friday as important economic reports will be published in the US. Depending on whether the data turns out to be strong, the pair will resume its fall (as USD will grow) or remain inside the sideways channel. On the 5-minute time frame, the key levels are 1.3193, 1.3246, 1.3276, 1.3351, 1.3366, and 1.3407 - 1.3416. We recommend trading near them on Friday. The price can bounce off these levels or overcome them. As usual, Take Profit should be set at the distance of 40-50 pips. On the 5M chart, you can use all the nearest levels as targets, but then you need to take profit, taking into account the strength of the movement. When the pair passes 20 pips in the right direction, we recommend setting Stop Loss to a breakeven point. On December 3, the UK will publish the Services PMI.In the US, the most important NonFarm Payrolls and ISM report for the services sector will be published. There will also be a number of less significant publications that should be taken into account. So, we expect a rather volatile day on Friday.
