07, July 2016

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The pound continued to fall against the US currency, despite BoE Governor (Mark Carney) clear plan on: how to support the British economy. The political vacuum in the United Kingdom is blocking any further actions to support the economy. Meanwhile, the outflow of the capital in the country is also gaining power.

Current situation

The GBP/USD remained under pressure, its main trend is down. The GBP/USD broke a strong psychological level 1.3300 and lost about 200 pp. The pair set a fresh 31-year low at the mark 1.2793. The resistance is at 1.3100, the support comes in at 1.2900.

The indicators remained in a red zone. MACD decreased, which is a sell signal. RSI remained in the oversold area, it is also a sell signal.

The GBP/USD is below the Moving Averages (50, 100 and 200) on the 4 hour chart. The Moving Averages are moving downwards. All indicators support the bearish trend.

Trading recommendations

We believe that any recovery will be short-lived and will be limited in 1.3500 region. The main trend is down. We think that the levels 1.2900 and 1.2700 are the next sellers’ targets.