26, October 2016

GBP/USD (a 4-hour chart)

General overview

There were no macroeconomic releases in the UK. The BOE's Governor Carney speech was the main event on Tuesday.

Current situation

Sellers continued to dominate in the market on Tuesday. The GBP/USD pair remained under pressure in a narrow range, trading a few pips above 1.2100. The pair was sandwiched between 50 and 100 EMAs in the 1 hour chart. The 100-EMA provided a solid resistance and limited the pound further recovery. The 50, 100 and 200 EMAs slowed down their decline. All moving averages are pointing lower. The current resistance is seen at 1.2200, the support is at 1.2100.

MACD indicator is at the centerline. If the histogram enters the negative territory, that will indicate sellers’ growing strength. If MACD returns into the positive area the buyers will take control over the market. RSI is within the neutral area.

Trading recommendations

We prefer to sell now. After breaking 1.2200 the price will move towards 1.2100.