21, October 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

GBP/USD reached a new high at the U.S. session after the news showed that jobless claims fell less than expected last week, continuing to put pressure on weak dollar.

The pair broke 1.6100 and rose to its highest level in 9 days at 1.6171. The pound also received a support on Thursday on strong retail sales data in the UK.

The pair reached the 1.6160 resistance (the high of September 19) and it could not reach up to 1.6177 (maximum of 4 October). Now the support may be found in the price range of 1.6060/50 (20-day SMA / maximum of Wednesday) and 1.6000 (the psychological level).

There is a strong and confirmed buy signal, as the chart is consolidated below Chinkou span, and the Ichimoku cloud is above the price.

The upward movement will be presumed until the Kijun-sen is located at the level 1.6060, being below the price.

Bollinger Bands are widening, showing a buy signal.
The MACD histogram is growing.

Trading recommendations

The rebound from the 1.6140 support level will allow the price to come to a strong resistance level 1.6240 for the second time, 1.6275 is the retest of the weekly level. We expect a consolidation.