28, October 2015

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The third quarter UK GDP release was the main event of the day. The trade deficit increase amid the British currency revaluation against the euro is traditionally a negative factor for an economy growth. However, that is not so bad for the UK economy. The unemployment level reduction and the average earnings growth, taking into account premiums make the household spending increase which eventually moderates out the mentioned above negative factors.

The pair tends to decline. The pair failed to break through the key resistance of 1.5390 and it is under pressure now.

The first support is at 1.5300, the next one is 1.5200. The resistance is at the level of 1.5390, the second one is at 1.5460.

We have a strong sell signal; the price is below the Cloud now. The pair is above the Chinkou Span. The Tenkan-sen and the Kijun-sen are directed downwards. The downward movement will be continued until the pair does not break the Ichimoku Cloud upwards.

The MACD is below its signal line in the negative territory. The histogram is decreasing.

Trading recommendations

If the price breaks the level of 1.5300, the downward movement will be continued to 1.5200. In case of a growth the level of 1.5390 will be our first target.