04, February 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview
The British pound also, like the Euro, fell versus the “buck”. However the losses were less significant and belonged most likely to the tendency of the market to give preference to U.S dollar amid fallen optimism as there was no publication of any significant economic news in Britain.

The pair still remains above the 50-day SMA that acts as the nearest support. However a breakthrough and fixing below it will confirm the decrease to the stronger support at the level 1.6200–1.6250.

The northern movement is canceled after the pair broke the cloud. We have a weak and confirmed sell signal. The price is below the cloud and above the Chinkou Span.

The downward movement will be in a force as long the price is below the Kijun -sen. Tenkan-Sen is crossing Kijun-sen down. Bothe lines are horizontal.

Bollinger bands indicator is broadening and directed downwards.
The MACD is in a negative zone, showing a decrease.

Trading recommendations

The beginning of the trading week may start with a rollback to 1.6490–1.6500, then a recoil is expected with a further fall downward.

The volumes are sufficiently high for the last six weeks. Apparently, the correction target is a weekly support 1.6180 that might be tested this week.