10, July 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The British pound closed the trading against the dollar at the opening prices, but it was lucky not to become one of the currency market outsiders. The sterling sales waves were caused by the UK manufacturing volume data in May that unexpectedly turned out significantly weaker than it was expected. The investor's disappointment was prompted by the UK industrial production report fall.

The indicators remain in a positive territory in the annual comparison, but with a clear slowdown against the April values.

There was not long correction on the British pound. The break of 1.7115 support turned out to be a false one.

The reverse return to the level of 1.7115 led to the price’s exit from the testing downward channel.

The price is finding the first support at 1.7115, the next one is at 1.7050. The price is finding the first resistance at 1.7160, the next one is at 1.7220. There is a confirmed and weak buy signal. The price is above the Cloud and it is above the Chinkou Span.

The Tenkan-sen and the Kijun-sen show a horizontal movement and form a “Dead cross”. The upward movement will be until the price is under the Cloud.

The MACD histogram is in a neutral territory.

Trading recommendations

The short-term growth target is the last week's resistance level of 1.7760. This level break will open the way up to: 1.7220, 1.7250, 1.7300.