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11.11.202416:40 Forex Analysis & Reviews: GBP/USD: Trading Plan for the US Session on November 11th (Analysis of Morning Trades)

In my morning forecast, I highlighted the 1.2880 level as a key area for market entry. Let's review the 5-minute chart to analyze the situation. A decline followed by a false breakout around 1.2880 provided a good entry point for buying the pound. This resulted in a modest 20-point rise before the pair came under pressure again. The technical outlook for the second half of the day remains unchanged.

Exchange Rates 11.11.2024 analysis

To Open Long Positions on GBP/USD:

The pound has continued its decline, as expected. Given the absence of major U.S. economic data, further pressure on the pair in the second half of the day would not be surprising. Therefore, I won't rush into buying.

A false breakout near the 1.2884 support—similar to the scenario I analyzed earlier—would confirm a valid entry point for long positions. The target would be a recovery toward 1.2919. A breakout and retest of this range could confirm a new entry point for long positions, aiming for 1.2946. The ultimate target will be the 1.2972 area, where I plan to take profits.

If GBP/USD continues to decline and there is no bullish activity around 1.2884—which seems likely in the second half of the day—the pair risks falling toward 1.2859, potentially setting the stage for a test of the monthly low. Only a false breakout at 1.2859 would create a suitable condition for opening long positions. I plan to buy GBP/USD immediately on a rebound from the 1.2835 low, aiming for a 30-35 point correction within the day.

To Open Short Positions on GBP/USD:

Sellers have maintained their dominance and show no signs of retreating. If the pair attempts to rise, a false breakout near the morning resistance at 1.2919 would offer a good selling opportunity, targeting another decline to the 1.2884 support.

A breakout and retest from below of this range could deal a blow to the bulls, likely triggering stop-loss orders and pushing the pair toward 1.2859. The ultimate target will be the 1.2835 area, where I plan to take profits.

If GBP/USD rises and bears fail to act at 1.2919—where moving averages currently favor sellers—buyers might attempt a larger correction at the start of the week. Bears would then need to retreat to the 1.2946 resistance area. I will sell there only on a false breakout. If there is no downward movement at that level, I'll consider short positions on a rebound from 1.2972, targeting a 30-35 point correction downward.

Exchange Rates 11.11.2024 analysis

Commitment of Traders (COT) Report:

The October 29 COT report indicated a reduction in long positions and a minimal increase in short positions. Expectations that the Bank of England is likely to cut interest rates at its next meeting continue to add pressure on the pound. Combined with recent challenges related to the UK budget—which the new prime minister plans to address through tax increases—the outlook for growth remains unfavorable.

Amid U.S. elections and anticipated rate cuts in the United Kingdom, the pound is likely to face continued challenges in achieving upward momentum.

The latest COT report showed that long non-commercial positions decreased by 7,967 to 132,636, while short non-commercial positions grew by just 253 to 66,280. This widened the gap between long and short positions by 1,079.

Exchange Rates 11.11.2024 analysis

Indicator Signals:

Moving Averages:Trading is below the 30- and 50-day moving averages, indicating continued bearish momentum.

Bollinger Bands:The lower boundary of the indicator near 1.2884 acts as support in the event of further declines.

Indicator Descriptions:

  • Moving Average (MA): Identifies current trends by smoothing volatility and noise.
    • Period: 50 (yellow)
    • Period: 30 (green)
  • MACD Indicator: Tracks the convergence/divergence of moving averages.
    • Fast EMA: Period 12
    • Slow EMA: Period 26
    • SMA: Period 9
  • Bollinger Bands: Measures price volatility.
    • Period: 20
  • Non-commercial traders: Speculators such as retail traders, hedge funds, and large institutions using futures markets for speculative purposes.
    • Long Non-commercial Positions: Total long open positions held by non-commercial traders.
    • Short Non-commercial Positions: Total short open positions held by non-commercial traders.
    • Net Non-commercial Position: The difference between short and long positions held by non-commercial traders.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Miroslaw Bawulski,
Analytical expert of InstaSpot
© 2007-2024
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