16, October 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

Like the euro the British pound also was under the strong pressure against the US dollar. The pound sales were caused by the UK economic data, noting that the UK inflation became slower in September than it was expected. We expect the UK employment data and the salary dynamics information.

Negative fundamental data within the GBP (Consumer Price Index) led to a confident bearish trend continuation. At yesterday's trading session traders were able to get out of the rising channel and broke through the support level of 1.5950 downwards.

There is a confirmed and a strong sell signal. The price is below the Cloud and it is under the Chinkou Span. The Tenkan-sen and the Kijun-sen show a downward movement and form a “Dead Cross”. The downward movement will be until the price is under the Cloud.

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

Trading recommendations

The decrease shall be continued. The targets are 1.5860 and 1.5770.