In my morning forecast, I drew attention to the 1.3388 level and planned to make trading decisions based on it. Let's look at the 5-minute chart to see what happened. A decline followed by a false breakout at that level led to a buy signal for the pound, which resulted in a rise of over 40 points. The technical outlook was revised for the second half of the day.

To open long positions on GBP/USD:

Buyers defended the 1.3388 support level in the first half of the day, expecting a more cautious stance from the Bank of England on interest rates and inflation. Unfortunately, the BoE decision will be decisive, as the U.S. market is closed today and there is no fundamental data expected. In case of a decline in GBP/USD following the BoE decision, I prefer to act near the new support level of 1.3417 formed earlier today. A false breakout there would provide a good entry point for long positions with the goal of returning to resistance at 1.3447. A breakout with a retest from top to bottom of this range will offer a new entry point with the prospect of reaching 1.3472. The ultimate target will be the 1.3503 level, where I plan to take profit. If GBP/USD declines and there is no bullish activity around 1.3417 in the second half of the day, pressure on the pound may increase significantly. In that case, only a false breakout near 1.3384 would be a suitable condition to open long positions. I also plan to buy GBP/USD immediately on a rebound from the 1.3363 support with an intraday correction target of 30–35 points.

To open short positions on GBP/USD:

Sellers can only hope for a dovish stance from the Bank of England and further rate cuts by the regulator—something that clearly won't happen at this meeting. If the pound reacts bullishly to the meeting outcome, only a false breakout near 1.3447 will give a sell signal with a target of a decline toward 1.3417. A breakout and retest from below of this range would lead to stop-loss triggers and open the path to 1.3384. The furthest target would be the 1.3363 level, where I plan to take profit. If demand for the pound returns in the second half of the day and bears remain inactive near 1.3447 (where moving averages currently favor sellers), GBP/USD could see a more substantial upward move. In that case, selling should be postponed until a test of the 1.3472 resistance. I will open short positions there only after a false breakout. If there is no downward movement there either, I'll look for short entries on a rebound from 1.3503, aiming for a 30–35 point intraday correction.

COT Report (Commitment of Traders) – June 10

The COT report for June 10 showed an increase in long positions and a decrease in shorts. Despite clear signs that the Federal Reserve will maintain interest rates, the release of data showing a notable slowdown in U.S. inflation did not provide substantial support for the dollar, which in turn supported demand for the British pound. The decisive factor for the dollar's future direction will be Jerome Powell's interpretation of the inflation situation and his forecasts for possible rate cuts in the fall. These comments will determine the future path of the GBP/USD pair, which continues to show steady growth. The latest COT report showed that non-commercial long positions rose by 7,404 to 111,076, while non-commercial short positions fell by 9,015 to 59,442. As a result, the gap between long and short positions narrowed by 12,378.

Indicator Signals:

Moving AveragesTrading is taking place below the 30- and 50-period moving averages, indicating a potential decline in the pound.

Note: The periods and prices of the moving averages are based on the H1 chart, as viewed by the author, and may differ from the standard daily moving averages used on the D1 chart.

Bollinger Bands In case of a decline, the lower boundary of the indicator near 1.3384 will act as support.

Indicator Descriptions:

• Moving Average – Identifies the current trend by smoothing out volatility and noise.
  • Period 50 – yellow on the chart
  • Period 30 – green on the chart
• MACD (Moving Average Convergence/Divergence) – Fast EMA: 12, Slow EMA: 26, Signal SMA: 9
• Bollinger Bands – Period: 20
• Non-commercial traders – Speculators such as individual traders, hedge funds, and large institutions using the futures market for speculative purposes and meeting certain criteria
• Non-commercial long positions – The total long open interest held by non-commercial traders
• Non-commercial short positions – The total short open interest held by non-commercial traders
• Net non-commercial position – The difference between long and short positions held by non-commercial traders