03, January 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

British news publications concordant with news from Europe and the U.S.. The attention is paid to December PMI index for the industrial sphere. The indicator is expected almost unchanged compared with the November value - according to various estimates expect growth to 58.5 from 58.4 to 58.3 or deceleration is expected.

Later this week and early next we expect PMI construction industry and services for the last month of last year. Traders expect its slowdown and these rumors can cause a drop in popularity of the sterling. If today's news is negative it could give a boost to selling.

The northern movement is confirmed and strong. The price is fixed above the cloud and below the line Chinkou Span.

The upward movement will be in a force as long the price is above the Kijun -sen. Kijun -sen is horizontal, Tenkan-Sen is directed upwards.

Bollinger bands started to expand again and being directed upwards. The current downward movement is confirmed and by MACD histogram.

Trading recommendations

1.6500/20 level has been reached. The price just tested the level having rebounded back down. The pair is at 1.6410 now.

Indicators still show "bullish" sentiment, but with an obvious weakening. In these circumstances, we can assume the continuation of the correction to the recent outbreak of growth, which will probably be held in the range 1.6520 - 1.6460/50.