28, November 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The UK 10-year bond yields fell below 2% yesterday that is a bearish signal for the pound. The UK investments volume for the third quarter decreased by 0.7%, indicating the business representatives negative expectations.

There was the downward trend line breakthrough of 1.5660 within the pound. Besides the buyers also managed to consolidate above this level. The bearish trend reversal was amid the low volumes.

The price is finding the first support at 1.5660, the next one is at 1.5550. The price is finding the first resistance at 1.5870, the next one is at 1.5950.

The price is in the Cloud and it is under the Chinkou Span. The Tenkan-sen shows an upward movement and the Kijun-sen shows a horizontal movement.

The MACD histogram is in a positive territory. The price is correcting.

Trading recommendations

We suppose the pair will go to 1.5870 first. Having overcome the first target the price might go upwards to 1.5950 and 1.6030.