FX.co ★ Technical analysis and trading recommendations for the GBP/USD currency pair for January 27, 2010

4-hour timeframe

The total picture:

Now, we can see the downward movement continuation. The target level of 1.6090 on Ishimoku is reached, however, the price strengthened below Kijun-sen at the day timeframe that can signify about the downward movement continuation. That is why, in case of the price fixing below 1.6090, next target for sales will be at 1.5970 (the support level). The price overcame Ishimoku indicator. For now, only sales are recommended, but if the price strengthens above Kijun-sen, which is placed at 1.6185, it is recommended to close positions. Chinkou Span is below the price line that testifies about the downward trend and enhances the signal. Bollinger Bands are down-directed and widening that signals about the downward movement. MACD also is moving down, supporting the downward trend.

Trading recommendations:

In case of the price strengthening lower than the target level of 1.6090, it will be possible to open trading positions with the target at 1.5970. Stop loss to set above 1.6185. Otherwise, it is recommended to wait for purchase signal formation.

The picture clarification:

Ishimoku indicator:

Tenkan-sen — red line

Kijun-sen — blue line

Senkou Span A — light brown stipple line

Senkou Span B — light purple stipple line

Chinkou Span — green line

Bollinger Bands indicator:

3 yellow lines

MACD indicator:

The red line and the histogram with the white bars in the indicators window.

Good trading,

Stanislav Polyanskiy

January 27, 2010