GBP/USD: Ichimoku analysis (Feb. 21)
By Tatyana Norkina, FBS analyst
Daily. At the beginning of the week the pair soared to new highs breaking above levels of 2009. On Monday GBP/USD reached the $1.6825 area. However, then it rolled back down due to an overbought market, as one can judge by the location of the line Chinkou Span. During the week the pair declined and corrected to support the Tenkan-sen. Note that Tenkan and Kijun formed a golden cross, and the Cloud was to expand the range. This means that the bulls will wait for the correction to end and soon resume buying.
Chart. Daily GBP/USD
H4. At H4 the pair decreased to the upper limit of the Ichimoku Cloud. The indicator lines here also indicate that the current phase is correctional. Tenkan and Kijun formed dead cross above the bullish Cloud. There’s a chance that pound will bounce up from Senkou Span A. But if the line doesn’t stand the pressure of the bears in the short-term period, the correction will continue deep into the Cloud. Break of $1.6620 would increase the likelihood of decline to $1.6540.
Chart. H4 GBP/USD