29, December 2014

GBP/USD (a 4-hour chart)

GBP/USD (a 4-hour chart)

General overview

The British pound is likely to be under pressure again. The negative ten-year bond yields have increased, reaching the fresh yearly high, caused by the negative data and the strong British data and the US GDP release for the third quarter. All these factors point out to the strong bearish signal.

The support is at the level of 1.5550 and for two weeks it has rebounded the sellers upwards. After the fundamental news publication the level was broken through. The support of 1.5550 breakthrough led to the price exit beyond the downward channel boundaries. The pair broke the level of 1.5550 upwards at the end of the last week.

The price is finding the support at 1.5480. The price is finding the first resistance at 1.5550, the next one is at 1.5660.

There is a confirmed and a strong sell signal. The price is under the Cloud and it is under the Chinkou Span. The Tenkan-sen shows a downward movement and the Kijun-sen shows a horizontal movement. The downward movement will be until the price is under the Cloud.

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

Trading recommendations

The price is likely to go to the downward trend line 1.5400.