On the hourly chart, GBP/USD on Friday made two rebounds from the 1.3425 level, and on Monday continues moving upward toward the 76.4% retracement level at 1.3470. A rebound from this level would work in favor of the U.S. dollar and a pullback toward 1.3425 and the support zone of 1.3357–1.3371. A consolidation above 1.3470 would increase the likelihood of further growth toward 1.3530 and 1.3579.

The wave structure remains "bearish." The last completed upward wave broke the highs of the two previous waves, but the most recent downward wave broke all previous lows. Thus, the trend can be considered "bearish," but the news background has played a major role in shaping it. In my view, the news background has already shifted in favor of the bulls, so the trend may soon turn "bullish" again. The situation is ambiguous and depends largely on news developments.

There was no news background on Friday, but the market is now fully focused on the Fed's next moves. Last week, several FOMC members expressed readiness to cut the interest rate in September, which is giving bullish traders extra support. In my view, the situation could change before the next Fed meeting, scheduled for September 17, as another labor market report will be released before then — the very one that triggered the sharp dovish shift in the FOMC's stance. In addition, two U.S. inflation reports will be released before September 17, both of which have a strong influence on the Fed's decisions. Therefore, the dollar could weaken over the next five weeks due to new expectations of FOMC monetary policy easing, but, as Jerome Powell has repeatedly noted, it is too early to make definitive conclusions. I believe the Fed's rate outlook will become clearer in September. A lot can happen before September 17, to the point where a rate cut might no longer matter.

On the 4-hour chart, the pair reversed in favor of the pound after a "bullish" divergence on the CCI indicator and a close above the 1.3378–1.3435 resistance zone. This opens the way for continued growth toward the next Fibonacci level at 1.3795. No emerging divergences are observed today on any indicator. The "bullish" trend may resume.

Commitments of Traders (COT) Report:

The sentiment of the "Non-commercial" trader category turned more "bearish" in the last reporting week. The number of long positions held by speculators fell by 22,164, while the number of short positions fell by 889. However, this sharp drop in interest in the pound, according to COT reports, does not reflect the real market picture, as interest in the dollar is also falling. The gap between long and short positions currently stands at about 65,000 versus 98,000. Yet, as we can see, the pound continues to rise.

In my opinion, the pound still has room for a decline. The news background for the dollar during the first six months of the year was extremely negative, but it is slowly starting to improve. Trade tensions are easing, key agreements are being signed, and the U.S. economy in Q2 will recover thanks to tariffs and various types of investment in the U.S. At the same time, prospects for Fed policy easing in the second half of the year could exert significant pressure on the dollar.

U.S. and UK News Calendar: On Monday, the economic calendar contains no notable events. The news background will have no influence on trader sentiment today.

GBP/USD Forecast and Trading Advice: Selling the pair is possible today on a rebound from the 1.3470 level on the hourly chart, targeting 1.3357–1.3371. For buying, a rebound from the 1.3114–1.3139 zone was required. I advised keeping those trades open with targets at 1.3357–1.3371, 1.3425, and 1.3470. All targets have been reached. A close above 1.3470 would allow holding long positions with targets at 1.3530 and 1.3579.

The Fibonacci grids are drawn from 1.3371 to 1.3787 on the hourly chart and from 1.3431 to 1.2104 on the 4-hour chart.