16, September 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

As a part of the referendum in Scotland expectations the pound/dollar is likely to stay under a pressure, and the downward movement is likely to be continued regardless of its result. The larger correction development can start after a local minimum is formed.

The pound’s target was the gap closing. Against the background of the high-volume the buyers were not only able to close the gap, but also came close to the strong resistance level of 1.6270.

The price is finding the first support at 1.6180, the next one is at 1.6100. The price is finding the first resistance at 1.6270, the next one is at 1.6340.

The price is in the Cloud and it is under the Chinkou Span. The Tenkan-sen and the Kijun-sen show a horizontal movement and form a “Golden Cross”.

The MACD histogram is in a neutral territory. The price is consolidating.

Trading recommendations

The pair is close to the strong resistance 1.6270-1.6290. If the pair retests it we expect the consolidation.