22, May 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The market is expected to fall again.

Falling prices can give Mark Carney, the new head of the Bank of England some room to maneuver when he takes in hand the Bank in July. We can suppose that the weak CPI data may generally have an adverse effect per pound.

Apart from that, we should also follow the Bank of England Minutes. Earlier this month, the Bank kept its police unchanged and it will be interesting to hear the views of the MPC, regarding the future path of the inflation.

Chinkou Span is below the price that is bearish signal. Tenkan-Sen is below Kijun-Sen. Tenkan-Sen and Kijun-Sen are directed downwards. The Cloud is directed down.

Bollinger Bands indicator is turning up forming a side channel.
MACD is in the negative zone and growing.

Trading recommendations

If the falling continues, the pound will go to April 4 minimum 1.5032 and then to 1.4829. Should the pair continue growth and pass 1.5322 that would question the short-term negative outlook, targeting GBPUSD to the May 13 high 1.5384.