FX.co ★ Daily analysis of GBP/USD for January 20, 2014

Daily chart: This pair has found resistance at the level of 1.6447, but the bearish trend in the medium term is still maintained, as this pair hasn't formed patterns that may indicate a change in trend. However, the trend may change if the pair manages to break the resistance level of 1.6447. Moreover, if this pair does consolidate below the level of 1.6326, it's expected to fall to the level of 1.6235. The MACD indicator is still in negative territory.

H4 chart: The GBP/USD has found strong resistance near the level of 1.6441, where it has formed a fractal, so it is very likely that this pair fall back to the 200-day moving average. However, the support level of 1.6336 is quite strong, so we must be cautious of false breakouts at that level. For now, we recommend caution, because the trend has not yet been clearly defined. The MACD indicator is entering extremely overbought zone.

H1 chart: The GBPUSD remains above the 200 SMA and remember that this pair found resistance near the point of control last week at the level of 1.6440. If this pair manages to break the resistance level of 1.6419, which is expected to rise to the level of 1.6464. 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 1.6419, take profit is at 1.6464, and stop loss is at 1.6375.