24, June 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The British sterling slowed its growth against the dollar. There was not so much economic data, in fact, the only information published was about the UK public sector net borrowing in May, but the "cable" could not grow on this support as the borrowing was higher than last year and amounted to 13.3 billion British pounds against 8.7 billion previously, an increase of the budget deficit.

The resistance level of 1.7000 breakthrough was followed by a pull back. The rollback target is the support level 1.7000 which price approached on the decreasing volumes.

The rising trendline is located on the 1.7000 support level, which will serve as the further obstacle to the sellers.

The price is finding the first support at 1.7000, the next one is at 1.6940. The price is finding the first resistance at 1.7040, the next one is at 1.7080. There is a confirmed and strong buy signal. The price is above the Cloud and it is above the Chinkou Span. The upward movement will be until the price is above the Kijun-Sen. The MACD histogram is in the positive territory.

Trading recommendations

The 1.7000 mark retest is more likely to lead to the short-term consolidation. Then we expect the price bounce up. The bounce potential target is the next resistance level of 1.7054. The break of this level will open the way up to 1.7100.