FX.co ★ Daily analysis of GBP/USD for December 31, 2013

Daily chart: This pair continues to make consolidation moves below the resistance level of 1.6540. Now, it is expected to form the bullish pattern to continue strengthening the current bullish trend. However, if the pair manages to break the support level of 1.6447, it's expected to fall to the level of 1.6326, which would be a turnaround. The MACD indicator stays in positive territory and GBP/USD remains above the 200 SMA.

H4 chart: The GBP/USD continues to find resistance in the bullish trend line near the level of 1.6550. Now this pair is trying to drop below the support level of 1.6483. We should note that this pair formed several fractals above the bullish trend line, so we must be careful when placing buy orders below these levels. The MACD indicator is in extreme overbought zone and entering negative territory.

H1 chart: Near the support level of 1.6464, the pair has formed a Point of Control (POC), which can serve as strong support for GBP/USD. If this pair takes a bullish rebound at that level, it would be expected to rise again to the level of 1.6507, where this could make a breakout. If successful, it is expected to rise to the level of 1.6544. The MACD indicator is still 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 1.6507, take profit is at 1.6554, and stop loss is at 1.6471.