Paying attention to the 4-hour chart, you will notice that:
- almost the entire Thursday in the GBPUSD currency pair was dominated by bearish sentiments, as a result of which our first two targets (1.3876 and 1.38505) were achieved; also note that at the moment the quotes were very close to our third target – 1.3815,
- noticeable support for the British pound (GBP) formed at 1.3837,
- since the beginning of the current day, bullish sentiments have been dominating in this currency pair.
Now let’s look at the indicators:
- The currency rate is sandwiched between a moving average with a period of 34 (resistance level 1.3887) on the one hand and averages with periods of 55, 89 and 144 (a series of support levels 1.38365, 1.3821 and 1.38025) on the other.
- The MACD histogram crossed the zero line from top to bottom tonight, is now in the negative zone and below its signal line, continues to decline smoothly and thus gives a signal to sell the British pound (GBP).
- Stochastic Oscillator headed to the exit from the oversold zone and is giving an opposite signal, as the% K line rises above the% D line.
Despite the conflicting signals from the indicators, we expect the British pound (GBP) ‘recovery’ to continue, with potential bullish targets at 1.3898, 1.39365 and 1.3981.
The bullish scenario will be canceled in case of a breakdown of the support level 1.3837, which may open the way to the levels 1.38025, 1.3755 and 1.3715.
We remind Forex traders that today they should pay attention to a number of significant events in the UK, which can have a noticeable impact on the further course of trading:
- at 09:00 Moscow time. data on retail sales will be published,
- at 11:30 Moscow time. the values of business activity indices will become known
Resistance levels: 1.3876, 1.3887, 1.3898, 1.39105, 1.39365, 1.3949, 1.3957, 1.3981
Current price: 1.3857
Support levels: 1.3837, 1.38225 / 21, 1.3815, 1.38025, 1.3786, 1.3755, 1.3715
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