05, February 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The pound has been under pressure since Monday. The "cable" sales were provoked by PMI index in January which turned out just below the forecast, though, it showed the absence of the recession.

The pair is Likely to test the strong support in the area 1.6200-1.6250.

In the future if it stays above 1.6200 we expect a rebound to the area 1.6620 and probably further to the resistance 1.6750.

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 directed downwards.

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

Trading recommendations

There is a strong support level 1.6240 on the pair's way, which could serve as a temporary obstacle to the sellers. Should the pair break the level it will fall further.