22, January 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

The pound grew yesterday. According to Sky News, the International Monetary Fund plans to revise its growth forecast for the UK economy earlier than for any other major economy. The Fund may increase the growth forecast for the UK economy in 2014 from 1.9% to 2.4%. Meanwhile, housing prices in the UK, according to Rightmove - rose in January, after two months of decline by 1% m/m, which was the largest in the history of price increases in January.

The situation is the same as it was the day before. The pair is being traded above the 50-day SMA, thereby saved a good chance to grow from the current levels to 1.6620 with testing the key resistance 1.6750.

The northern movement is canceled after the pair broke the cloud downwards. The price is below the cloud and above the Chinkou Span.

The downward movement will be in a force as long the price is below the Kijun -sen. Kijun-sen and Tenkan-Sen are directed down. Tenkan-Sen is crossing Kijun-sen horizontal.

Bollinger bands indicator is broadening and directed upwards.
The MACD histogram is in a positive zone, showing a growth.

Trading recommendations

The trading volumes near a downward trend line 1.6435 show a divergence indicating upward trend weakening. It is quite likely the pair to retest the resistance 1.6445.