To open long positions on GBPUSD, you need:

In my morning forecast, I paid attention to the resistance of 1.3237 and recommended opening long positions from it when breaking and fixing above this level. Let’s take a look at the 5-minute chart and talk about what came out of it. On the chart, you can see how the bulls are achieving a breakout of 1.3237, however, the normal reverse test of this level from top to bottom did not happen. Therefore, I am still out of the market and waiting for an update to the level of 1.3237.

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Only if the bulls hold 1.3237 or achieve the formation of a false breakout, I recommend opening long positions in the continuation of the upward trend. This may happen immediately after the release of data on retail sales in the United States. If the report coincides with the forecasts of economists, bulls will continue to buy the pound, as well as if the data is much worse, which will indicate a contraction in the economy. In this case, the nearest target for buyers will be this month’s maximum of 1.3310, where the first stop of the upward movement will be. Only a break and consolidation above this range forms a new wave of growth of the pound with an exit to the area of 1.3378 and 1.3467, where I recommend fixing the profits. In the scenario of good data on the US economy and the return of GBP/USD to the level of 1.3237, it is best to postpone long positions until the minimum of 1.3168 is updated or buy the pair immediately for a rebound from the larger area of 1.3106, which is a kind of lower border of the wide side channel of 1.3106-1.3310.

To open short positions on GBPUSD, you need:

Bears are still fighting to regain control over the level of 1.3237, which they managed to miss in the first half of the day amid the lack of fundamental statistics and news on Brexit. The initial task will be to return the GBP/USD to the level of 1.3237 and test it from the bottom up, which forms a fairly good entry point into short positions, which will be able to push the pound to a minimum of 1.3168, where I recommend fixing the profits. Only a breakout of 1.3168 with consolidation under this range will give sellers of the pound more confidence, which will open a direct road to the lows of 1.3106 and 1.3034. In the scenario of a lack of activity among sellers and poor data on the US economy, it is best to postpone short positions until the maximum of 1.3310 is updated, provided that a false breakout is formed there. I recommend selling GBP/USD immediately for a rebound from the maximum of 1.3378, based on a correction of 20-30 points within the day.

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In the COT reports (Commitment of Traders) for November 10, there was a minimal increase in long positions and a sharp influx of short positions. Non-commercial long positions grew from 27,701 to 27,872. At the same time, short non-commercial positions increased from 38,928 to 45,567. As a result, the negative non-commercial net position was -17,695 against -11,227 a week earlier, which indicates that the sellers of the British pound retain control and their preponderance in the current situation.

Signals of indicators:

Moving averages

Trading is conducted above 30 and 50 daily averages, which indicates an active attempt by buyers of the pound to continue growth.

Note: The period and prices of 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

If the pair declines, the lower border of the indicator around 1.3168 will provide support.

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.

The material has been provided by InstaForex Company – www.instaforex.com

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