21, August 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The British currency resumed its decline and has fallen off against the dollar by more than 100 points. The inflation data have the initial pressure on the British sterling, and messages from the United States about the improvements in the housing market supported its sales. The UK inflation fell more than expected in July, which could seriously shake the market participants’ confidence who are awaiting the rate growth.

On the background of the "fundamental data" the intermediate support level 1.6675 breakthrough was held with the high volume formation. The downward trend is still in force, the current price decline came to the descending channel 1.6600 lower bound.

The price is finding the first support at 1.6570, the next one is at 1.6500. The price is finding the first resistance at 1.6640, the next one is at 1.6700.

There is a confirmed and a 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. The downward movement will be until the price is under the Cloud.

The MACD histogram is in a negative territory. The price is going down.

Trading recommendations

The potential growth target is the resistance level of 1.6700.