On Thursday, February 17th, the GBP/USD continued rising after breaking the level of 1.3580. However, the pair's movement was of little interest to traders. First, it was weak again. The intraday volatility was about 80 pips but half of this activity was seen during overnight trades. Second, the cable printed an unexpected plunge three times a day. And finally, there were no important publications apart from geopolitical news. Admittedly, the geopolitics deteriorated. Even the level of 1.3580, which used to be rather effective, was ignored on Thursday. Overall, GBP/USD has been stuck between 1.3488 and 1.3643 for 12 trading days already. This wide sideways channel makes it difficult to conduct analysis and open trades. If the channel were narrow, we could have traded a rebound from its boundaries. Instead, we have to watch the price moving from one boundary to another for several days without even touching them.
In the 5M time frame, the technical picture looks awful. It can be clearly seen that the trend was flat for most of the day. Only in afternoon trades, the pair made an attempt to resume the uptrend. During the European session, the cable rested on 1.3563, 1.3580, 1.3598, and 1.3603. Though the distance between them is 40 pips, these levels are considered a resistance area. Should traders try to find a signal in this area, they were surprised to see that the price almost reached the next level. As a result, all they could do today was to go long after a break of 1.3603. But in this case, it was rather difficult to get some profits. First, the buy signal was very weak. Second, the price went mere 25 pips after the formation of this signal. It was enough to set a Stop Loss at a breakeven point where the trade was most probably closed. On the plus side, we did not incur any losses today as the rate has been barely moving over the past two weeks.
Trading plan for Friday, February 18th:
In the 30M time frame, the upward trend became invalid but it was not replaced by a downward trend. The cable has been stuck between 1.3488 and 1.3643 for the past 12 days. So, there is simply no definite trend. We cannot predict when this tendency will end. The target levels in the 5M time frame can be found at 1.3488, 1.3563-1.3580, 1.3598-1.3603, 1.3652-1.3660, and 1.3695. After the price breaks Set a Stop loss at a breakeven point if the rate goes 20 pips in your direction after opening a trade. Tomorrow the United Kingdom will release the retail sales report for January. Hopefully, market participants will pay attention to this data at least. As long as the price is stuck in the sideways channel, it does not matter. The United States will not present any crucial reports. So, we can only expect the British stats to trigger some moves and hope that there will be no negative geopolitical news.
