FX.co ★ Daily analysis of GBP/USD for December 20, 2013

Daily chart: GBP/USD formed a fractal above the 1.6447 level, when it tried to make a breakout at that level without success. Now, GBPUSD is forming a bullish pattern above the support level of 1.6326, but we must be vigilant against any fall of this pair, as GBPUSD moves within an area of great uncertainty. If the pair manages to break the 1.6326 level, it is expected to fall to the level of 1.6235. The MACD indicator is still in negative territory.

H4 chart: This pair stays below the resistance level of 1.6441. Without significant changes that may have an impact on the current trend. If the pair manages to break the support level at 1.6292, it is expected to fall to the level of 1.6262. Moreover, if this pair break the 1.6441 level, it will be expected to rise to the level of 1.6464. The MACD indicator is entering extremely overbought zone and is in neutral territory.

H1 chart: GBPUSD remains above the 200 SMA, and above that level, the pair made a bullish rebound, which could indicate that this pair continues to search dynamic support at the 200 SMA. If this pair manages to break the resistance level at 1.6419, it is expected to rise to the level of 1.6464, which is very likely since this pair has given no indication of change in the intraday trend. The MACD indicator is 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 1.6419, take profit is at 1.6464, and stop loss is at 1.6375.