11, October 2016

GBP/USD (a 4-hour chart)

General overview

The British pound is under pressure the second week in a row. The positive UK data was not able to support the sterling.

Current situation

 The pound was inactive on Monday, trading lower after turbulent Friday’s trades. The sterling was attempting to consolidate around 1.2400 during the trades on Monday. The 50, 100 and 200 EMAs slowed their downward movement in the 4 hours chart. The moving averages kept pointing lower. The current resistance is seen at 1.2500, the support lies at 1.2400. 

MACD shows a divergence in the 4 hours chart. MACD decreased which confirms the strength of sellers. RSI remained within negative territory.

Trading recommendations

The GBP/USD is oversold, trading will be according to technical factors, due to the absence of strong drivers. If the price rebounds from the current support the currency pair will grow towards 1.2600. A downward pressure will send the quotes towards the historical lows at 1.2000.