09, August 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The main catalyst for the GBP/USD movement was the Bank of England inflation report. Initially, the pair responded to the announcement of the fall of 7% confidence threshold for unemployment. But then the Bank of England raised its GDP forecast for 2013 to 1.5% instead of the original 1.2% and for 2014 to 2.7% from 1.9%, and that pair broke through the strong support level. From the opening level 1.5347 the pair fell to a minimum 1.5204, and then grew to a maximum of 1.5530 and closed trading at 1.55.

Now Ichimoku Analysis

Price entered the cloud on the four hour chart. The sell signal is weak, if the growth continues, the sell signal will be canceled. Kijun-Sen and Tenkan-sen still form a "dead cross", the price is above the signal line. Cloud is directed downwards. Tenkan-sen is slightly increased and the Kijun-sen is reduced.

Bollinger Bands indicator shows a downward movement, the bands are directed down.
MACD left a negative area and is growing up now.

Trading Recommendations

The pair grew sharply. If the pair consolidates above the moving average the growth will be continued to the resistance 1.5750. Otherwise, we will see the correction in the direction of the 1.5300-1.5320 support area.

In the future, a sustained break below 1.5300 will indicate the resumption of the downtrend from 1.4810 to test a minimum. In this case, a break below 1.5100 minor support will confirm this movement.