The GBP/USD pair fell again to the level of 1.2477, which was already worked out yesterday. However, even though this level was not overcome, the price settled below the ascending trend line, so the upward trend was formally canceled. "Formally" - because the pound can still continue to grow, as it did in the last two weeks. Trendlines are a strong tool for technical analysis, but not 100%. Since the pair has failed to overcome an important support level twice, it means that the pound may continue to grow, as well as the euro. There were no important events in the UK today. That is, traders could pay attention only to the report on orders for durable goods. It was published just at the time when the pair was turning around the level of 1.2477, so we can conclude that the market has worked out that this is not the most important report. The US will release another Federal Reserve minutes, which will certainly contain information about the mood of the members of the Monetary Committee regarding a further rate hike. This information could theoretically influence the pair's movement, but by that time, traders will have to leave the market anyway.
On the 5-minute timeframe, it was rather strange and uncomfortable on Wednesday. On the one hand, we observed two good impulses: first down, then up. The movements were smooth, without jerks, and the volatility was 80 points. On the other hand, not a single trading signal was formed during the day. The pair was approaching the level of 1.2471, but did not reach it for more than three points, so there is no reason to speak of a rebound with an error. The 1.2477 level is new, like 1.2597. So we got a picture when the movements were good, but there was not a single trading signal. Unfortunately, this also happens sometimes. Let's also take note of the level of 1.2559 - also new - this is today's high. It can still be updated and adjusted accordingly.
How to trade on Thursday:
The upward trend is formally canceled on the 30-minute timeframe. However, since the pair failed to settle below the level of 1.2477, the pound retains good prospects for further growth. This week there are not very many important reports and events, but we see that the market is still trying to work out even the most important ones. On the 5-minute TF, it is recommended to trade at the levels of 1.2371, 1.2471-1.2477, 1.2559, 1.2597-1.2601, 1.2674-1.2697. When the price passes after opening a deal in the right direction for 20 points, Stop Loss should be set to breakeven. There are no major reports or events scheduled in the UK on Thursday. The US will publish a report on GDP for the first quarter in the second assessment. Recall that the first estimate was -1.4% Q/Q. If this value worsens, then traders will get grounds for new long positions on the pound/dollar pair. Otherwise, the price may try to overcome the level of 1.2477 on the third attempt. Of course, a lot will depend on where the pair is at the time when the report is released.
