21, July 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The British pound fell slightly against the dollar. They did not publish disappointing fundamental news for the sterling and it is likely that the news that pressured the "cable" had come from abroad:the new sanctions against Russia and the airplane crash in Ukraine.

The British pound corrective decline against the dollar was in a rising trendline 1.7080. The trading volumes near the trend line form a divergence.

The price is finding the first support at 1.7050, the next one is at 1.7000. The price is finding the first resistance at 1.7115, the next one is at 1.7160.

There is a confirmed and strong 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 expect the price stop near 1.7050 that will turn into a consolidation. The longer the price consolidates above 1.7050, the greater chances it has to rebound upwards.