03, November 2015

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The pound has significantly grown, especially taken into consideration the euro decline. If we compare two banks that can potentially increase the rate we will see the difference between the Bank of England and the Fed rhetoric. The Fed maintains the hope of the December rate hike while the last month Bank of England reports tone was rather mild. The inflation report can cast doubt on the Bank of England decision. If it coincides with the economic growth forecasts decrease, the market will regard it as a "dovish" tone.

The first support is at 1.5390, the second one is at 1.5300. The resistance is at the level of 1.5460, the next one is at 1.5550.

We have a buy signal now as the price broke the Cloud upwards and stays above of it. The pair is above the Chinkou Span. The Tenkan-sen and the Kijun-sen are directed upwards. The upward movement will be continued if the pair stays above the Ichimoku Cloud.

The MACD is above its signal line in the positive territory. The histogram is growing.

Trading recommendations

If the price keeps growing, it will go to the level of 1.5460. The decrease target is the support level of 1.5390.