21, March 2017

GBP/USD (a 4-hour chart)

General overview

The pound took advantage of a broad based US dollar weakness and extended its winning steak on Monday. Investors waited for Haldane’s speech later the day on Monday and UK’s Consumer Price Index on Tuesday hoping to get some fresh drivers.

Current situation

The GBP/USD pair maintained its bid tone on Monday. Buyers pushed the price higher in the night session and hit fresh monthly highs above 1.2400. The major gave up its fresh gains in the noon. The currency pair weakened and returned below 1.2400 ahead of the NY opening. The pair bounced off the 200-EMA upwards in the 4 hours chart. The 100 and 200 EMAs maintained their bearish slope while the 50-EMA pointed higher in the mentioned timeframe. The resistance lies at 1.2400, the support comes in at 1.2300.
The MACD indicator continued consolidating within overbought levels. RSI consolidated within positive territory.

Trading recommendations

The overall picture is bullish. However, the major is overbought. As the most probable scenario, we consider a move downwards towards 1.2350. The spot will continue moving higher if the cable remains above 1.2400.