FX.co ★ GBPUSD: daily analysis for October 29, 2013

Daily chart: GBPUSD had a fall below the resistance level at 1.6146. If the pair manages to break the support at the 1.6046 level, it is expected to fall to the level of 1.5883, which would usher in a strong bearish trend. Moreover, it is likely that this pair will start forming a higher low pattern below the current levels. If the pair manages to break the bearish trend line, one would expect that the bearish trend will continue for many more days. The MACD indicator remains in negative territory.

H4 chart: GBPUSD is falling below the bullish trend line near the 1.6125 level. It is very likely that this pair extended its decline to the support level of 1.6004, which houses the 200-day moving average. If the pair manages to break that level, it is expected to fall to the level of 1.5895. This pair is very bearish, but expect to conduct a bullish rebound this moving average of 200. The MACD indicator remains in negative territory.

H1 chart: This pair is consolidating below the 200-day moving average. If this pair does break the support at the level of 1.6075, it is expected to drop to the level of 1.6031. On the other hand, if the pair manages to break the resistance at the 1.6117 level, it would be expected to rise to the level of 1.6170. For now, we recommend caution when placing sell orders, because GBPUSD could recover in the next few hours. 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 1.6075, take profit is at 1.6031, and stop loss is at 1.6117.