18, July 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The British pound spent yesterday's trading in a narrow sideways range against the dollar and closed at opening prices. The strong employment data in Britain noted the unemployment rate decrease in June to 6.5% from 6.6%, with the significant applications number reduction for unemployment benefits - 36 thousand instead of the expected -27 thousand after 33 thousand in May did not provok the directed activity growth in favor of sterling.

The price consolidation happened at around 1.7140 in the middle of two important levels of 1.7170 and 1.7100

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 non-confirmed and weak sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen shows a downward movement, and the Kijun-sen shows a horizontal movement and form a “Dead cross”. The downward movement will be until the price is under the Cloud.

The MACD histogram is in a neutral territory.

Trading recommendations

We believe the falls can be continued now. The first target is the level 1.7050. We do not exclude the growth to 1.7220.