GBP/USD: pair lacks drivers to rise

August 9, 2013 in Forex Analysis

GBP/USD: pair lacks drivers to rise

1. Current trend of GBP/USD

Since Wednesday the pair GBP/USD has been testing key resistance level at 1.5550, but isn’t able to consolidate above it. Pair lacks the drivers to rise. Today’s data on trade balance didn’t help it either. Market reacts feebly to the decrease of deficit rate down to -8.1 billion pounds, the pair stays around key level of 1.5550.

2. Important levels: support and resistance

The level of 1.5550 is the key one, but we expect the price to overcome it and go further up to the levels of 1.5630 and 1.5700. The fall to the level of 1.5490 is not so likely. If the price consolidates above 1.5550, it would be logical to open long positions with targets at 1.5630. Short-term sell positions can be opened at the level of 1.5530.

3. Technical indicators

On the daily chart Bollinger Bands are directed upwards. Price chart breaks through the upper line, which indicates the possibility of downward correction. MACD histogram is in overbought zone, its volumes are increasing. Stochastic lines are also in overbought zone, but the signal to buy hasn’t been formed yet.

Dmitriy Zolotov
Analyst of LiteForex Group of Companies

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