On the hourly chart, the GBP/USD pair on Tuesday first rebounded from the 161.8% corrective level at 1.3110, and then from the 127.2% Fibonacci level at 1.3186. Today, the pound may make another rebound from 1.3110 or 1.3139. In that case, a new reversal and growth toward 1.3186 may occur. A consolidation of quotes below 1.3110 would favor the U.S. dollar and signal a possible decline toward the 200.0% corrective level at 1.3024.

The wave situation remains bearish. The new upward wave failed to break the previous peak, while the last downward wave (which developed over three weeks) broke the previous low. The information background in recent weeks has been negative for the U.S. dollar (in my opinion), yet bullish traders have not taken advantage of the opportunities for an upward move. To complete the "bearish" trend, growth above 1.3470 or the formation of two consecutive "bullish" waves is required.

For the third day in a row, the pound has been trading between 1.3110 and 1.3186. The start of the new week has been quite uneventful, and traders failed to appreciate the only significant piece of news — the end of the U.S. government shutdown. The same can be said about yesterday's reports on UK inflation and wages. British inflation prompted a mild bearish attack, but the sideways range held steady after it. Today, there will be no information background, so it is unlikely that traders will break out of the range during the day. However, if new chart signals appear, they can certainly be acted upon. Overall, the end of the "shutdown" is a positive development for the U.S. dollar, but there remain many more negative factors for it. Thus, I expect further growth of the pound. It may not be long or strong, as the Bank of England might ease its monetary policy at the next meeting due to the high unemployment rate. However, if inflation accelerates again, the Bank could instead decide to maintain current monetary policy parameters at the December meeting.

On the 4-hour chart, the pair continues to decline within a descending trend channel. If a new "bullish" trend is now beginning, we will gradually receive confirmation of this. I will start counting on a strong rise of the pound after quotes close above the channel. Consolidation above 1.3140 would allow us to expect continued growth of the pound. No developing divergences are observed today.

Commitments of Traders (COT) Report

The sentiment of the "Non-commercial" category of traders became more bullish in the last reporting week, although that data is from about six weeks ago. The number of long positions held by speculators increased by 3,704, while short contracts decreased by 912. The current spread between longs and shorts is roughly 85,000 versus 86,000. Bullish traders are once again tipping the scales slightly in their favor.

In my view, the pound still faces downside risks, but with each passing month the U.S. dollar appears weaker and weaker. Whereas earlier traders worried about Donald Trump's protectionist policies without knowing their eventual outcome, now they may be concerned about the consequences of those policies: a possible recession, the continuous introduction of new tariffs, and Trump's pressure on the Federal Reserve, which could make the regulator "politically biased." Thus, the pound looks much less risky than the U.S. currency.

Economic Calendar for the U.S. and the U.K.

For November 12, the economic calendar contains no notable events. The informational background will have no influence on market sentiment on Wednesday.

Forecast for GBP/USD and Trading Recommendations

Sell positions on the pair are possible today if quotes close below the 1.3110–1.3139 level on the hourly chart, targeting 1.3024, or on a rebound from 1.3186. Buy positions can be opened on a rebound from 1.3110 or 1.3139, targeting 1.3186 and 1.3247.

The Fibonacci level grids are built between 1.3247–1.3470 on the hourly chart and 1.3431–1.2104 on the 4-hour chart.