GBP/USD: Ichimoku analysis
Daily. Last week GBP/USD failed to hold above $1.6200. The overbought market went against the bulls who hoped to make the price settle above this handle. During the week the pair was declining and entered Tenkan-Kijun channel on Friday. The fact that the prices fixed below Tenkan (TS) – is the sign of the possible continuation of the short-term downtrend. The immediate support is at $1.6000. If this level is breached, the price may slide to Kijun line (KS). Note though that Tenkan and Kijun are still set to rise. In addition, Senkou Span A (SSA) strengthens the bullish Cloud.
Chart. Daily GBP/USD
H4. The picture isn’t that bright on H4. At the end of last week, the pair dropped deep into the Ichimoku cloud. The Tenkan and Kijun formed the Dead Cross (C), which is still relevant as the bulls so far haven’t broken up the resistance of the Kijun line (KS). Therefore, in the next few days there’s a high probability of further corrective decline that can stop only at the lower bottom of the Cloud.
Chart. H4 GBP/USD
Tatyana Norkina for FX BAZOOKA