FX.co ★ Daily analysis of GBP/USD for May 26, 2014

Daily chart: The GBP/USD has dropped below the resistance level of 1.6851, after this pair has made a pullback at this level. GBP/USD is likely to fall to the support level of 1.6766, where the bullish trend line is. However, if the pair manages to make a breakout at the support level, it is expected to fall to the level of 1.6663. The MACD indicator is entering neutral territory.

H4 chart: The GBP/USD is finding support at the 1.6822 level where the 200 SMA is located. If the pair manages to make a breakout at that level, it would be expected to fall to the level of 1.6785. However, the GBP/USD could perform a bullish rebound at 200 SMA. MACD is in negative territory.

H1 chart: This pair has consolidated below the control point of forming a bearish pattern, and it is now very likely that the GBP/USD will fall to the support level of 1.6800. If the pair manages to make a breakout at that level, it would be expected to fall to the level of 1.6750. The MACD indicator is entering oversold.

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 1.6850, take profit is at 1.6900, and stop loss is at 1.6800.