27, August 2013

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General Overview

GBP/USD started to grow last week, but it closed with small losses at 1.5563 at the end of the week. This week will give us five events on the schedule.

Britain has demonstrated solid numbers for the production and GDP data last week, but the British failed to take advantage of this against the background of wider strengthening of the U.S. dollar. In the U.S., weak data on employment and housing cooled enthusiasm for the dollar as the minutes of FOMC confirmed that the restriction of the QE is only a matter of time.

Ichimoku Analysis

The pair keeps working out a "golden cross. The current buy signal is strong and confirmed, as Chinkou span entrenched above the price, and the price is above the Ichimoku cloud.

If the growth continues, the pair will continue growing to 1.57. First the pair needs to consolidate at 1.56, reached the other day. The cloud is directed upwards. Tenkan-sen is slightly increased and the Kijun-sen is horizontal.

Bollinger Bands indicator shows an upward movement, the bands are directed down.
The MACD histogram is located in a negative zone near to the zero level.

Trading Recommendations

To continue falling the pair needs to break 1.5540, it will open the way to the target levels 1.5500 and 1.5480. Should the price break 1.5480 the potential of a downward movement will be dramatically increased and the price will go down to the support level 1.5435 or 1.5400 weekly trend line.