20, October 2016

GBP/USD (a 4-hour chart)

General overview

The pound strengthened on Wednesday due to the positive labour market report. The unemployment level has remained unchanged despite the Brexit referendum results.  

Current situation

The GBP/USD remained in bulls' hands on Wednesday. Bulls pushed the price towards 1.2300. The sterling was battling with the resistance 1.2300 during the day. The pound quotes broke the 50 and 100 EMAs and snapped the 200-EMA in the 1 hour chart. The 200-EMA became an initial barrier for the price which was struggling to take it out during the day. The 50-EMA crossed the 100-EMA upwards in the same chart. The moving averages (50, 100 and 200) are neutral. The current resistance is seen at 1.2300, the support lies at 1.2200. 

MACD entered the positive area. MACD grew which indicates the sellers’ positions weakening. RSI approached the oversold area.

Trading recommendations

Our short-term outlook remains bullish. A break above 1.2300 risks a growth towards the resistance at 1.2400.