GBP/USD (a 4-hour chart)
The pound reached a three-week maximum at 1.5185. The favorable environment for the growth was created by a draft budget for the new fiscal year.
The Head of Treasury said that saving scenario was correct and has already begun to bear fruit, GDP growth continues, last year's GDP was more than expected. George Osborne says that the economy does not slide into another recession.
Despite the positive news, the British economy is not in very good condition, the forecast for GDP shows a slight fall from 1.2% to 0.6% this year.
The pair continued to grow yesterday.
The pair is above the cloud. We have a strong and confirmed buy signal. The Tenkan-Sen is going upwards, the Kijun-Sen horizontal, the cloud is growing.
If the price returns under the cloud, under the Kijun-Sen and Chinkou Span, the southern movement resumes to the first support level –1.5065.
Bollinger indicator started to show discrepancies in lines, confirming the upward trend. The price broke through the top line, there might be a correction to the level 1.5115.
MACD is above the zero line, it crossed the signal line from below, indicating that the further growing continues.
The growth continues. Bollinger bands diverge, market volatility increases.
In the case of growth the pair will move to the level 1.5250, after consolidation at it the pair will continue to grow to 1.5360.
The pound can return to the downward movement if MACD turns down.
The first target of the downward movement will be the level 1.5065. Should the pair break through this level and fix below it the pound will go to 1.4940.
Besides technical analysis be advised to consider the fundamental news as well when you make a decision.