Paying attention to the 4-hour chart, you will notice that:
- for most of the American session on Wednesday, the GBPUSD currency pair was dominated by bullish sentiment, as a result of which our first alternative target (1.3949) was reached; also note that early this morning, quotes were very close to our second alternative target – 1.3981,
- at the level of 1.3964, there was a noticeable resistance for the British pound (GBP), after which the consolidation began.
Now let’s look at the indicators:
The exchange rate has consolidated significantly above the moving averages with periods of 55, 34, 89 and 144, which are now a number of support levels 1.38995, 1.38925, 1.3842 and 1.3826.
The MACD histogram is in the positive area and above its signal line, continues to grow rapidly and thus gives a signal to buy the British pound (GBP).
The Stochastic Oscillator is in the overbought zone and is not giving clear signals at the moment, since the% K line almost crossed with the% D line.
Since trusting only one clear signal is extremely risky, and also due to a slowdown in the growth of quotations, as a confirmation that bullish sentiments may again increase in the forex market in this currency pair, it is necessary to wait for the breakdown of the resistance level 1.3964, which can open the way to levels 1.40025 and 1.4060.
Otherwise, the consolidation may turn into a downward correction, the targets of which will be the levels of 1.3914 and 1.3859.
Resistance levels: 1.3964, 1.3976, 1.3981, 1.40025, 1.4006, 1.40085, 1.4060
Current price: 1.3955
Support levels: 1.39345, 1.3914, 1.38995, 1.38925, 1.38805, 1.3859, 1.3842, 1.3837
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