On the hourly chart, the GBP/USD pair finally managed to rebound from the 1.3633–1.3641 level on Wednesday and began declining toward the 100.0% retracement level at 1.3556. A rebound in prices from this level would favor the pound and allow for some growth toward the 1.3633–1.3641 level. Consolidation below 1.3556 would allow traders to expect a continuation of the decline toward the next Fibonacci level of 76.4% at 1.3489.

The market situation remains "bullish." The last completed downward wave did not break the previous low, while the latest upward wave (which is not yet complete) broke the previous high. Thus, the bulls currently have the initiative in the market, and their advantage is strengthening each day. The "bullish" trend can be considered broken only after the low of the last completed wave is broken—that is below 1.3414—or after two downward waves have formed.

The fundamental background on Wednesday allowed bearish traders to launch a small attack, which they successfully carried out. However, further growth of the U.S. currency requires new drivers beyond technical and retracement factors. The dollar may continue its moderate growth today, as it previously experienced a continuous decline of 250 points. However, its upward potential is strictly limited. Tomorrow, two events will take place in the United States that the market has been awaiting since Monday. Traders are already demanding at least some clarity from Kevin Warsh. Either the Fed is committed to fighting inflation through tighter monetary policy, or this is merely a wish on the part of Kevin Warsh and his colleagues along the lines of "it would be good to reduce inflation, but the regulator will not take any action." Clarity is needed. The Nonfarm Payrolls report will provide updated data on the number of jobs created over the past year, and there is a fairly high probability that these figures will be revised. As a rule, they are revised downward. Thus, tomorrow is likely to be a very interesting day, and the market may move much more actively than it has earlier this week.

On the 4-hour chart, GBP/USD rose to the 0.0% retracement level at 1.3657 and rebounded from it. Thus, a reversal in favor of the U.S. dollar occurred, and the decline toward the 23.6% Fibonacci level at 1.3538 began. Consolidation above 1.3657 would allow traders to expect further growth of the pound. Bullish divergences are developing on the CCI and RSI indicators, which may halt the decline.

Commitments of Traders (COT) Report:

The sentiment of the "Non-commercial" trader category became slightly less "bearish" over the latest reporting week. The number of Long positions held by speculators increased by 12,075, while the number of Short positions increased by 10,427. The gap between the numbers of Long and Short positions is currently effectively 77,000 versus 132,000. The gap and the bears' advantage are gradually narrowing, although the bears still retain a substantial advantage. Previously, the bears' dominance was unquestionable, but it is now being called into question because the fundamental background has changed.

I still do not believe in a "bearish" trend for the pound, but in the near term, everything will depend on Trump's trade policy, the monetary policies of the Fed and the Bank of England, as well as the duration, scale, and consequences of the war in the Middle East. In recent months, the market has repositioned itself toward peace, but negotiations between Iran and the United States failed before they had properly begun. And there is no guarantee that they will resume in the near future. Meanwhile, FOMC monetary policy is shifting toward abandoning further tightening, which does not add optimism for dollar bulls.

News Calendar for the United States and the United Kingdom:

• United States – Change in Initial Jobless Claims (12:30 UTC).

On August 27, the economic events calendar contains one item. The economic background will have no impact on market sentiment on Thursday.

GBP/USD Forecast and Trading Tips:

Selling the pair was possible following consolidation below the 1.3633–1.3641 level on the hourly chart, with a target of 1.3556. These trades can remain open today. Buying is possible following a rebound from 1.3556, with a target of 1.3633–1.3641.

The Fibonacci grids are drawn from 1.3557–1.3272 on the hourly chart and from 1.3158–1.3655 on the 4-hour chart.