FX.co ★ GBPUSD: Daily analysis for October 22, 2013

Daily chart: GBPUSD has performed a bearish rebound near the resistance level at 1.6146, and this pair is likely to drop to the support level of 1.6046. However, this may involve the formation of a lower high pattern to continue upwards to the resistance level at 1.6235. On the other hand, we must be aware fractal formed near the 1.6236 level, which could indicate a change in the trend in the medium term. The MACD indicator is in neutral territory.

H4 chart: GBPUSD is finding support at the bullish trendline near the 1.6122 level. It is very likely that this pair manages to break the trendline and fall to the level of 1.6095, which holds another bullish trendline. On the other hand, if the pair manages to break the resistance at the 1.6164 level, it would be expected to rise to the level of 1.6247. The MACD indicator remains in negative territory.

H1 chart: This pair has been falling below the resistance level at 1.6170 and now, GBPUSD is trying to break the support at the 1.6117 level. If successful, it is expected to fall to the level of 1.6075, where the 200-day moving average is. On the other hand, if the pair manages to break the resistance at 1.6170, it would be expected to rise to the level of 1.6216. The MACD indicator remains in negative territory.

Trading recommendations for today: Based on the H1 chart, place buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.6216, take profit is at 1.6252, and stop loss is at 1.6126.