02, December 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The pound rose versus the dollar to a maximum in August 2011 after the publication of half-yearly Financial Stability report of the Bank of England, which was presented by CB governor Mark Carney. He said about plans to cut the support for mortgage lending in the UK in order to stimulate banks to increase small business loans and to prevent the threat of financial stability from the housing market. Beginning from the next year, concessional loans within the program of Funding for Lending Scheme can be received only by small companies; also the FLS cannot be used for residential mortgages.

Tenkan-Sen and Kijun- Sen has formed a «golden cross», Kijun-Sen is directed upwards, Tenkan-Sen is directed up as well. Ichimoku cloud has changed its direction, Chinkou is below the chart, the price is above the Ichimoku cloud. The upward movement will be continued as long as the Kijun-sen is below the price.

Bollinger bands are widening, directed upwards. MACD histogram crossed the zero line from the down up, its volumes are decreasing.

Trading recommendations

The volumes form a small divergence. Therefore, before the price continues to go up, the corrective pullback can occur to a sloping support line 1.6325. If the price does not break below 1.6325 the reverse bounce up is expected. The potential rebound target is 1.6365 and 1.6400.