empty
13.01.2025 12:23 PM
GBP/USD: January 13. The Pound Remains in Free Fall

On the hourly chart, the GBP/USD pair made a vague rebound from the 261.8% Fibonacci corrective level at 1.2303 on Friday and continues its decline. Today, the pair has already broken below the 1.2171 level, and the movement persists toward the next Fibonacci level at 323.6% — 1.2036. While Friday's drop was driven by fundamental data, Monday's continuation raises questions, but there is a clear answer: the current trend is bearish and very strong.

This image is no longer relevant

The situation with the waves leaves no doubts. The last completed upward wave failed to break the peak of the previous wave, while the current downward wave has broken the previous low. Thus, the bearish trend continues, and there is no question about it. To conclude the bearish trend, the pound must rise at least to the 1.2569 level and close above it confidently. This scenario is unlikely in the near future.

On Friday, strong US data prompted the dollar's growth and further attacks from bears. However, as mentioned earlier, the decline was not limited to Friday. Today marks the fifth consecutive day of GBP/USD's decline, with traders continuing to buy the dollar without needing new data. The US dollar has plenty of reasons to grow, including a strong economy, a dovish Federal Reserve stance, and the lack of strong catalysts for the pound and euro. Thus, each new drop in the pound or euro should not come as a surprise — the trend is bearish. Monday's trading lacks fundamental news, but early trading suggests that bearish traders are ready to continue their attacks. What could stop them?

This image is no longer relevant

On the 4-hour chart, the pair rebounded from the 76.4% Fibonacci corrective level at 1.2565, broke below the 100.0% Fibonacci level at 1.2299, and has been falling since. The pair's close below 1.2299 increases the likelihood of further declines toward the 127.2% level at 1.1993. The downward trend channel highlights the dominance of bears, who are unlikely to lose their grip in the near future. Only a close above the channel would signal a potential strong rise in the pound.

Commitments of Traders (COT) Report

This image is no longer relevant

The sentiment of the "Non-commercial" trader category remained virtually unchanged in the last reporting week. The number of long positions increased by 1,644, while short positions rose by 132. Bulls still hold the advantage, but it continues to erode. The gap between long and short positions is now only 21,000: 86,000 long versus 65,000 short.

In my view, the pound's prospects for further decline remain, as COT reports indicate an ongoing strengthening of bearish positions almost every week. Over the past three months, the number of long positions has decreased from 160,000 to 86,000, while short positions have risen from 52,000 to 65,000. I believe professional players will continue to unload long positions or increase short ones, as all potential catalysts for pound buying have already been exhausted. Graphical analysis also supports the pound's decline.

Economic Calendar for the US and UK

Monday's economic calendar contains no noteworthy events or data. The fundamental backdrop is expected to have no influence on trader sentiment today.

GBP/USD Forecast and Trading Recommendations

  • Sales: The pair could have been sold after rebounding from the 1.2569 level on the hourly chart. Additional sales were viable after the break below the 1.2488–1.2508 zone and a close below 1.2303. All nearby targets have been reached, and the decline continues with targets at 1.2036 and 1.1993.
  • Purchases: I do not recommend considering purchases today.

Fibonacci Levels:

  • Built from 1.3000 to 1.3432 on the hourly chart.
  • Built from 1.2299 to 1.3432 on the 4-hour chart.
Samir Klishi,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Trading Signals for EUR/USD for January 16-19, 2025: buy above 1.0290 (21 SMA - 4/8 Murray)

The key is to stay alert. If the EUR/USD pair manages to consolidate above the 200 EMA, we could expect a trend change so that the euro could continue

Dimitrios Zappas 13:57 2025-01-17 UTC+2

Trading Signals for GOLD (XAU/USD) for January 17-21, 2025: sell below $2,725 (overbought- 6/8 Murray)

The eagle indicator is showing overbought signals, so we will look for opportunities to sell in the next few days as long as the gold price remains below 6/8 Murray

Dimitrios Zappas 13:56 2025-01-17 UTC+2

Forecast for EUR/USD on January 17, 2025

The EUR/USD pair struggled to maintain support for bulls as bears continued to profit. On Thursday, the pair traded sideways, but Friday brought a renewed shift in favor

Samir Klishi 13:45 2025-01-17 UTC+2

Forecast for GBP/USD on January 17, 2025

On the hourly chart, GBP/USD failed to consolidate below the 1.2191 level on Thursday. A rebound from this level provided an opportunity for buying, but the resulting growth was weak

Samir Klishi 11:43 2025-01-17 UTC+2

Forex forecast 17/01/2025: EUR/USD, GBP/USD, Gold, Oil and Bitcoin

Useful links: My other articles are available in this section InstaForex course for beginners Popular Analytics Open trading account Important: The begginers in forex trading need to be very careful

Sebastian Seliga 10:47 2025-01-17 UTC+2

EUR/USD and GBP/USD on January 17 - Technical Analysis of the Situation

The past day has been marked by uncertainty and stagnation in the market. The currency pair is currently drawn to the daily short-term trend zone at 1.0308. As we approach

Evangelos Poulakis 08:14 2025-01-17 UTC+2

Forecast for EUR/USD on January 17, 2025

In the past day, the euro has experienced slight upward movement, as indicated by its technical indicators. If the signal line of the Marlin oscillator crosses into positive territory

Laurie Bailey 03:46 2025-01-17 UTC+2

Forecast for GBP/USD on January 17, 2025

Yesterday, the pound broke through the lower shadow of the daily candle for the fourth consecutive day at the support level of 1.2186. Given the ongoing uncertainty ahead

Laurie Bailey 03:46 2025-01-17 UTC+2

Forecast for AUD/USD on January 17, 2025

The Australian dollar tested the upper boundary of the descending price channel on the daily chart yesterday and then retreated downward. The failure to break above the channel reinforces

Laurie Bailey 03:46 2025-01-17 UTC+2

Trading Signals for EUR/USD for January 16-19, 2025: buy above 1.0260 (21 SMA - 4/8 Murray)

On the contrary, if the euro consolidates below the 21 SMA and below 4/8 of Murray in the next few hours, it is likely to continue its bearish sequence

Dimitrios Zappas 16:05 2025-01-16 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.