Paying attention to the 4-hour chart, you will notice that:
- at 1.37955 there is strong resistance for the British pound (GBP),
- for a long period of time, the strengths of bulls and bears are approximately equal.
Now let’s look at the indicators:
- The currency rate is sandwiched between the moving averages with periods of 89, 55 and 144 (a range of resistance levels 1.3780 / 81 and 1.3806) on the one hand and an average with a period of 34 (support level 1.3744) on the other.
- The MACD histogram crossed the zero line from the bottom up yesterday afternoon, is now in the positive zone and above its signal line, but today it began to move almost parallel to the time axis and is not giving clear signals at the moment.
- Stochastic Oscillator is in the neutral zone and is giving a signal to sell the British Pound (GBP), as the% K line falls below the% D line.
Since trusting only one clear signal is extremely risky, then as a confirmation that bearish sentiments may increase in the forex market in this currency pair, it is necessary to wait for the breakdown of the mirror level 1.37535, which can open the way to the levels 1.3729, 1.36935 and 1.36695.
Otherwise, the rate of the GBP / USD currency pair will move within the 1.37535 – 1.37955 price range.
An alternative (‘bullish’) scenario of the development of events will be ‘activated’ in case of a breakdown of the strong resistance level 1.37955, after which the quotes may go to the levels of 1.3833, 1.38535 and 1.3902.
Resistance levels: 1.3780 / 81, 1.37955, 1.3806 / 08, 1.3819, 1.3833, 1.38535, 1.3902
Current price: 1.3765
Support levels: 1.3764, 1.37535, 1.3744, 1.3729, 1.36935, 1.3681, 1.36695
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