GBP/USD: general analysis for January 10, 2014

January 10, 2014

Current trend

It became known yesterday that the Bank of England left interest rate unchanged at the level of 0.5%. Volume of bond repurchase program was also kept at the previous level of 375 billion pounds per month. Experts believe that the Bank of England intends to maintain the volume of incentive program until 2016. However, US Fed is planning to change monetary policy in the near future, thereby increasing demand for the American currency.

Support and resistance

On the H4 chart the pair GBP/USD has reached the upper limit of the trading channel at the level of 1.6489. Later the pair can reach resistance level of 1.6500, where there many stop-losses. If the price manages to break down this level, the pair will grow to the level of 1.6606. Possibility of growth is confirmed by the fact that the pair is trading above the moving average with the period 200 (1.6337), which is a strong support level.

Trading tips 

It is recommended to open long positions after breakdown of resistance level of 1.6500  with stop-loss near 1.6450 and a target of 1.6620.

Dmitry Agurbash

Analysts of LiteForex Group of Companies

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