08, August 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The sterling finished yesterday with losses against the dollar. The market got the negative impact from weak industry data in June, the release was worse than expected.

There will not be important economic statistics and all the market's attention is directed to BoE rate release. Investors do not expect any changes.

The price is finding the first support at 1.6770, the next one is at 1.6700. The price is finding the first resistance at 1.6860, the next one is at 1.6900.

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 horizontal movement and the Kijun-sen shows a downward movement. The downward movement will be until the price is under the Cloud.

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

Trading recommendations

If, based on fundamental factors, sellers can break below the current support level 1.6820, we believe there will be the bearish trend in the longer term. The potential decline targets are 1.6755, 1.6710.