FX.co ★ GBP/USD: daily analysis for December 18, 2013

Daily chart: The pair fell to the support level of 1.6235, but this made a bullish rebound and now it is trying to climb to the resistance level of 1.6326. However, the GBP/USD could perform a breakout at the level of 1.6235 before falling to the level of 1.6146. Moreover, if this pair does break the 1.6326 level, it is likley to rise to the level of 1.6447, thereby strengthening the overall bullish trend. The MACD indicator is still in negative territory.

H4 chart: The GBP/USD has made a bullish rebound on the support level at 1.6262, very close to the 200 SMA . If this pair manages to break the resistance level at 1.6292, it is expected to rise to the level of 1.6335. On the other hand, if the pair manages to consolidate below the 200 day moving average, it is seen to fall to the level of 1.6164, which would begin a bearish trend in the medium term. The MACD indicator is still in neutral territory.

H1 chart: This pair has made a bullish rebound near the 1.6216 level and now it is forming a higher low pattern below the resistance at 1.6291 level. If this pair takes a bearish rebound at that level, it is expected to fall to the level of 1.6252. Moreover, if it does break the support at the level of 1.6252, it is likely to fall to the level of 1.6216. The MACD indicator is still in positive territory and the GBP/USD stays below the 200 SMA.

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the GBP/USD pair breaks a bearish candlestick. The support level is at 1.6252, take profit is at 1.6216, and stop loss is at 1.6291.