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16.09.2026 05:33 AM
The GBP/USD currency pair showed no interesting moves on Tuesday and once again failed to break the 1.34651.3480 area. Thus we still expect the 1.34651.3480 zone to be the low point of the current downtrend. In our view, the market has already priced in the Federal Reserve's rate increase, so tonight one should not expect a renewed decline in the pair in almost any scenario. Of course this is not an absolute truth completely illogical moves regularly occur in the market. Price action for any instrument depends on the actions of the majority of large players rather than on Fed decisions or macro releases alone. Therefore, if market-makers decide to keep buying the dollar today, the dollar will continue to rise even if the Fed lowers the policy rate. Be prepared for any outcome. Also remember that the Bank of England meeting is tomorrow and the UK inflation report is due this morning. These two events are important and could support the pound. So generally we would expect the pair to rise today and tomorrow.
Technically, sterling continues to form a downtrend. The dollar may strengthen further against its peers, although the only clear basis at the moment is the market's belief in Fed tightening, which is essentially already priced in. Without a breakout above the 1.34651.3480 area, further declines will be difficult.
On the 5-minute timeframe on Tuesday, one buy signal was formed, which produced no profit or loss because intraday movement was virtually non-existent. Today, price action may be highly volatile but also very chaotic.
COT reports for the pound show that non-commercial traders have dominated the market with short positions for several months. The net position is negative despite the persistent long-term uptrend. Given events in the Middle East, it is unsurprising that dollar demand was high in the first half of 2026. The war formally ended, but the conflict persists. Only geopolitics can support the US dollar in the near term. However, until the pair closes below the trend line, we would not count on a strong decline.
In the long run, the dollar continues to weaken due to Donald Trump's policies, which is clearly visible on the weekly timeframe. The trade war will continue in one form or another for a long time, and Trump's policy is aimed directly and indirectly at weakening the US currency. The long-term uptrend remains, as evidenced by the trend line. Price recently tested that line and bounced off it. According to the latest COT report (dated September 8), the "Non-commercial" group closed 11,800 BUY contracts and 2,600 SELL contracts. Thus, the non-commercial traders' net position decreased by 9,200 contracts over the week.
On the hourly timeframe, the GBP/USD pair has moved into a downward trend. In the medium and long term, the pound still "looks" upward, so we believe any rise in sterling would be logical. We still do not see strong reasons for a prolonged and significant appreciation of the US currency. Even a hypothetical Fed rate-hike decision has already been priced in by the market several times.
For September 16 we highlight the following important levels: 1.30421.3050, 1.30961.3115, 1.31791.3187, 1.33011.3309, 1.33691.3377, 1.34651.3480, 1.3588, 1.36711.3681. The Senkou Span B line (1.3519) and the Kijun-sen (1.3511) can also generate signals. It is recommended to move the stop-loss to breakeven when the price moves 20 pips in the right direction. The Ichimoku lines may shift during the day, which should be taken into account when determining trading signals.
On Wednesday, the UK will publish an important inflation report that may adjust the BoE's stance ahead of tomorrow's meeting. In the US today the Fed meeting, the policy-rate decision, the dot-plot and remarks by Kevin Warsh. Volatility may be very high today.
Today, traders may open short positions targeting 1.33691.3377 if price breaks through the 1.34651.3480 area. Open long positions if price bounces from the 1.34651.3480 area, targeting 1.35111.3519 and 1.3588.
Support and resistance price levels are thick red lines where movement may conclude. They are not sources of trading signals.
The Kijun-sen and Senkou Span B lines are Ichimoku indicator lines transferred to the hourly timeframe from the 4-hour timeframe. They are strong lines.
Extreme levels are thin red lines from which the price has previously rebounded. They are sources of trading signals.
Yellow lines indicate trend lines, trending channels, and any other technical patterns.
Indicator 1 on COT charts shows the size of the net position of each category of traders.
