03, July 2015

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The UK PMI manufacturing sphere fell to the lowest level since May 2014, which calls into question the high economic growth. Moreover, the spread indicators UK/US widened in favor of the latter by the end of June, indicating that a high USA economic growth will provide support to the US currency.

Sellers reduced the price down amid the low volumes. There is consolidation between the support level of 1.5550 and the resistance level of 1.5670.

The price is finding the first support at 1.5550, the next one is 1.5460. The price is finding the first resistance at 1.5670, the next one is 1.5775.

There is a confirmed and a strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen shows a downward movement and the Kijun-sen shows a horizontal movement and form a “Dead Cross”. The downward movement will be until the price is under the Cloud.

The MACD histogram is in a negative territory. The price is consolidating.

Trading recommendations

The approach to the level of 1.5670 may lead to a price rebound down. The potential rebound targets are the support levels of 1.5550, 1.5460.