20, May 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

UK inflation forecast is revised towards a growth. To the surprise this news supported the pound, but modestly. On the daily chart the 1.52 is still the key support level for the pair.

Currently the pair is trading in the range 1.5250 - 1.5190. It is likely to go down to the key support level 1.5100, but to break this level the pair requires strong fundamental news.

In the future, it is most likely that the pound's falling will stop and the pair will start growing on the good news for Britain, the expected growth levels are 1.5310, 1.5370. 1.5410.

We expect important data on GDP and retail sales in Britain this week.

Chinkou Span is below the price that is bearish signal. Tenkan-Sen is below the Kijun-Sen. Both lines are directed downwards. The Cloud has a downward formation. The downward movement will be in effect until the pair is below the Kijun-sen and the Cloud.

Bollinger Bands show a downward movement, the bands are pointing down.

MACD is in a negative zone, below the signal line, showing a good signal to the correction with a further growth.

Trading recommendations

Indicators show a continued falling in a short term. The primary goal is the 4th April minimum - 1.5035. The intermediate target is 1.51.

Should the trend change we recommend to open long positions from 1.52 with take-profit at 1.5310.