29, January 2016

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The UK 4th quarter GDP was the main event this week for the country. The industrial production decline and the negative trade balance alongside with the high pound value are negative factors that traditionally impede the economic growth. The fourth quarter service PMI also showed a slowdown. The GDP data came in at the forecasted median: 0.5% (q/q) and 1.9% (y/y).

The price is finding the first support at 1.4320, the next one is at 1.4240. The price is finding the first resistance at 1.4400, the next one is at 1.4480.

There is a non-confirmed and a strong buy signal. The price is above the Ichimoku Cloud and it is above the Chinkou Span. The Tenkan-sen shows an upward movement and the Kijun-sen shows a horizontal movement. The upward movement will be until the price is above the Cloud.

The MACD indicator is in a positive territory. The price is increasing.

Trading recommendations

We expect the 1.4400 line break that will open the way for the buyers to 1.4480.