Daily analysis of major pairs for January 19, 2017

EUR/USD: There is a bullish signal on the EUR/USD pair. The EMA 11 is above the EMA 56 and the Williams' % Range period 20 is trying to slope upwards, after just leaving the overbought region. A further upwards movement is anticipated and the resistance lines at 1.0700 and 1.0750 would soon be tested.

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USD/CHF: As it was expected, USD/CHF has continued its downward journey. However, the psychological level at 1.0000 has appeared to be something price could not breach permanently to the downside. Price needs to go below it, staying below it, in order for the threat to the current bearish movement to disappear.

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GBP/USD: The GBP/USD pair is now in a bullish mode, though price retraced lower yesterday. The bearish retracement may turn out to be an excellent opportunity to go long in the context of a short-term uptrend. Some fundamental figures are coming out today and tomorrow and they may have impact on the markets.

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USD/JPY: The USD/JPY pair rallied yesterday, but that was not strong enough to overturn the recent bearish outlook. There is still a Bearish Confirmation Pattern in the market, which would be rendered invalid only when price goes above the supply level at 116.50.

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EUR/JPY: This cross pair is in a bearish mode, but there was a rally of 240 pips (from the low of 112.59). The bearish mode is already being threatened, and should price move upwards by another 200 pips, the bias would turn completely bullish. Today or tomorrow would determine what would happen eventually.

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Global macro overview for 19/01/2017

Global macro overview for 19/01/2017:

The Australian jobs market data beaten market expectations. The Unemployment Rate increased to 5.8% in December from 5.7% a month ago and the Employment Change has decreased to 13.5k from 37.1k a month ago (10.1k expected). The bigger picture is that the labour market still looks fragile as the level of employment is only 0.8% higher than a year ago. The number of full-time jobs is 0.4% lower than a year earlier while the number of part-time jobs is 3.4% higher. The trend towards more part-time jobs is currently the biggest problem with the employment growth and it needs to change if wages and household income growth is to improve from current modest rates. In conclusion, despite the positive data, there has clearly been a slowdown of momentum in the labour market. This situation might enable the RBA to donwgrade 2016/17 growth forecasts at its February 7 meeting. Besides, it can eventually result in a final cut from the RBA in the third quarter of 2017.

Let's now take a look at AUD/USD technical picture in the daily time frame. The bulls have managed to break out above the 61%fibo at the level of 0.7541, but they have met the bears at this level, who managed to push the price lower towards the moving average support around the level of 0.7500. Currently, this bearish engulfing pattern in the daily time frame hasn't been confirmed yet. However, if the market breaks out below the level of 0.7500 again, then the price is likely to head for support at the 0.7375 level.

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NZD/USD intraday technical levels and trading recommendations for January 19, 2017

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On November 8, significant signs of a bearish reversal were expressed around the upper limit of the depicted consolidation range (0.7350).

A bearish breakdown of 0.7250 (the lower limit of the depicted range) enhanced the bearish side of the market toward the price level of 0.7100 (recent bottom of October 28) which was broken as well.

Bearish persistence below 0.7100 allowed a quick decline toward 0.6960 (BUY zone) where bullish rejection and a valid BUY entry were expected. All T/P levels were successfully achieved.

Once again, bearish persistence below the price level of 0.7100 enabled the NZD/USD pair to pursue toward lower target levels around 0.6990 (the upper limit of the depicted BUY zone).

The price level of 0.6990 failed to apply enough bullish pressure. Instead of that, bearish movement continued toward the lower limit of the depicted BUY zone (0.6860) which provided significant bullish rejection on December 23.

The NZD/USD pair was trapped within the depicted price range (0.6860-0.6990) until a bullish breakout occurred.

A bullish breakout above 0.7000 allowed the pair to head towards the price level of 0.7100 (Key-Level) which failed to provide sufficient bearish pressure on the pair.

Instead, bullish persistence above 0.7100 (Key-Level) allows further bullish advance towards 0.7250 (SELL-ENTRY) where bearish rejection and a valid SELL entry can be offered.

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Analysis of gold for January 19, 2017

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Recently, gold has been trading downwards. The price tested the level of $1,197.39. On the 30M time frame, I found strong Fibonacci resistance levels near the price of $1,204.50. There is corrective Fibonacci expansion 100% and Fibonacci retracement 38.2%. My advice is to watch for potential selling opportunities. Stochastic seems to be overbought, which is a sign that gold may go lower. I placed Fibonacci expansion to find potential downward objective points. I got Fibonacci expansion 61.8% at the price of $1,194.20 and Fibonacci expansion 100% at the price of $1,187.45.

Resistance levels:

R1: 1,214.15

R2: 1,216.65

R3: 1,221.30

Support levels:

S1: 1,205.85

S2: 1,202.50

S3: 1,198.10

Trading recommendations for today: watch for selling opportunities.

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Global macro overview for 19/01/2017

Global macro overview for 19/01/2017:

The market analysts were surprised by the latest data from the British jobs market. The Claimant Count Change (provides data about those individuals who are out of work and who are claiming unemployment benefits) declined -10.1k unexpectedly, while market analysts expected a slight rise of 4.6k after 1.3k increase a month ago. Moreover, the Unemployment Rate remainded steady at the level of 4.8%, together with unchanged Claimant Count Rate (the number of people who claim unemployment benefits, but actively seeking work) at the level of 2.3%. Another good news was the fact, that Average Earnings Index increased 2.8% in the three-month period to November while market participants expected a 2.6% increase only. In conclusion, with employment still close to record levels and unemployment continuing to decrease, the latest indicators confirm that the UK jobs market remains a major bright spot for the UK economy.

Let's now take a look at EUR/GBP technical picture in the daily time frame. After the golden trend line break, the price has been capped at the level of 0.8855 and now it is falling from this resistnace to test the technical support at the level of 0.8672. The market is still trading above all of the moving averages and the near-term outlook is still bullish.

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USD/CAD intraday technical levels and trading recommendations for January 19, 2017

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The USD/CAD pair was trapped between the price levels of 1.3000 (61.8% Fibonacci level) and 1.3360 (50% Fibonacci level) until a bullish breakout took place one month ago.

The pair challenged the upper limit of the depicted channel around 1.3360-1.3400 which succeeded to apply enough bearish pressure on the pair.

Shortly after, a bearish engulfing weekly candlestick was expressed by the end of the week indicating strong resistance around 1.3550.

Bearish persistence below the price level of 1.3300 (50% Fibonacci Level) was achieved.

This allowed a further decline toward 1.3200 and 1.3080 (the lower limit of the depicted channel) where bullish rejection was expressed as anticipated.

A bullish breakout above 1.3360 (50% Fibonacci level) was expected to allow a further advance toward 1.3700-1.3750 (the upper limit of the depicted channel). However, significant bearish rejection was expressed around 1.3580 (recent established top).

The price level of 1.3300 (50% Fibonacci Level) failed to provide enough support for the recent bearish pullback.

That's why, the recent bearish pullback toward 1.3000 (61.8% Fibonacci level) offered a valid BUY entry as expected in previous articles.

This week, a bullish breakout above 1.3300 (50% Fibonacci Level) is needed to enhance bullish advance towards 1.3440 and 1.3550. Otherwise, the USD/CAD pair remains trapped within the current consolidation range (1.3000 - 1.3300).

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EUR/NZD analysis for January 19, 2017

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Recently, EUR/NZD has been moving sideways at the price of 1.4832. My previous analysis is still active. According to the 4H time frame, I found rejection from resistance at the price of 1.4900. EUR/NZD is in a short-term downward trend. My advice is to watch for selling opportunities. I have placed Fibonacci expansion and I found a downward target at the price of 1.4730.

Fibonacci Pivot Points:

Resistance levels

R1: 1.4925

R2: 1.4945

R3: 1.4985

Support levels:

S1: 1.4850

S2: 1.4830

S3: 1.4795

Trading recommendations for today: Watch for potential selling opportunities.

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Intraday technical levels and trading recommendations for GBP/USD for January 19, 2017

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The price zone between 1.3845 and 1.3550 (historical bottoms set in January 2009) was considered a significant demand zone to be watched for bullish recovery.

However, by the end of June a significant bearish break below 1.3550 was expressed as seen on the depicted charts (fundamental reasons). Bearish persistence below the demand level at 1.3550 enhanced the bearish scenario toward the price levels around 1.2700 (bearish projection target).

Since then, the GBP/USD pair has been trapped inside the depicted consolidation range above 1.2700 until a bearish breakout took place on October 6.

Daily persistence below 1.2700 confirmed the bearish Flag pattern. That is why, a bearish projection target would be located around 1.2020.

On October 25, Bullish recovery was initiated around the price level of 1.2080. That is why, a bullish pullback was executed toward 1.2700-1.2750.

Risky traders considered this bullish pullback toward the price zone of 1.2700-1.2750 to be a valid SELL entry. All T/P levels were successfully reached.

On January 16, the bullish price action was expressed around the demand level of 1.2000. That's why, a bullish engulfing candlestick was expressed on Tuesday.

Initial bullish target is located around 1.2550 provided that early bullish breakout above 1.2430 is achieved.

Otherwise, the next bearish destination would be located around 1.1200 (Fibonacci Expansion 100%) if bearish momentum is resumed.

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Intraday technical levels and trading recommendations for EUR/USD for January 19, 2017

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In January 2015, the EUR/USD pair moved below the major demand levels near 1.2100 where historical bottoms were previously set in July 2012 and June 2010.

Hence, a long-term bearish target was projected toward 0.9450.

In March 2015, EUR/USD bears challenged the monthly demand level around 1.0570, which had been previously reached in August 1997.

Later in April 2015, a strong bullish recovery was observed around the mentioned demand level.

However, next monthly candlesticks (September, October, and November) reflected a strong bearish rejection around the area of 1.1400-1.1500.

Again in February 2016, the depicted price levels around 1.1400-1.1500 acted as a significant supply zone during the bullish pullback.

That is why, recent bearish rejection was expected around the depicted supply levels (note the monthly candlesticks of May, August, and October 2016).

In the longer term, the level of 0.9450 remains a projected target if the current monthly candlestick maintains its bearish closure below the depicted monthly demand level of 1.0570.

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The long-term outlook for the EUR/USD pair remains bearish as the monthly chart illustrates. Bearish persistence below 1.0575 is needed to pursue this bearish scenario.

In September 2016, temporary bullish breakout above 1.1250 was expressed again, but evident bearish pressure was applied on the EUR/USD pair on September 16.

Closure below 1.1250 (supply level 1) maintained enough bearish pressure and enhanced the downside momentum toward the price level of 1.1000 (key level 1).

Bearish persistence below 1.0825 allowed further fall to occur at 1.0570 (demand level) where bullish rejection and a valid BUY entry were expressed on November 24.

Shortly after, the Fibonacci Expansion 100% (1.0825) constituted a recent supply level which offered a valid SELL entry on December 8.

Bearish persistence below the depicted demand level (1.0570) was expected to allow further decline towards 1.0220. However, significant bullish recovery was expressed around the price level of 1.0340 on January 3.

Bullish persistence above 1.0600 allows further bullish advance toward 1.0825 (Fibonacci Expansion 100%) where bearish rejection should be anticipated.

Bullish breakout above 1.0570-1.0600 was executed on January 12. Hence, the price level of 1.0600 now constitutes a recent demand level to be watched for bullish rejection if any bearish pullback occurs.

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Technical analysis of EUR/JPY for January 19, 2017

General overview for 19/01/2017:

The pair hit a fresh intraday high at the level of 122.30 after the weekend gap had been finally filled. Currently, the Elliott wave count is suggesting, that wave progression from the low at the level of 120.53 is in three waves, but it has an impulsive structure. The invalidation of this structure will come with the level of intraday support at 121.39 violation, but as long as this level is not hit, the outlook remains bullish.

Support/Resistance:

120.89 - Technical Support

121.39 - Intraday Support

122.01 - Weekly Pivot

122.41 - Intraday Resistance

122.82 - WR1

123.85 - Swing High

Trading recommendations:

The buy orders should now all be closed after the TP at the level of 122.01 was hit. Currently, the next good level to buy is the gray rectangular zone and the SL shlould be placed below the level of 121.39.

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Technical analysis of USD/CAD for January 19, 2017

General overview for 19/01/2017:

The market reversed strongly to the upside and now is trading just below 50%Fibo of the last swing down. The gray rectangular zone is the first target projection area for wave 1/a (main count) or wave 2/b (alternative count). In case of a further breakout higher, the next resistance is seen at the 61%Fibo at the level of 1.3377. Those levels are the key resistance levels for the day, because the price might start to stall/reverse at one of those levels and move lower in order to test the intraday support at the levle of 1.3188.

Support/Resistance:

1.2883 - WS2

1.2994 - WS1

1.3143 - Weekly Pivot

1.3188 - Intraday Support

1.3259 - WR1

1.3308 - Technical Resistance

1.3377 - 61%Fibo

1.3408 - WR2

Trading recommendations:

Day traders should keep the buy orders that are in play already, but the TP should be set lower than 1.3408 and for this two levels are appropriate: 1.33308 and 1.3377.

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Technical analysis of NZD/USD for January 19, 2017

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Overview:

  • The NZD/USD pair continues to move upwards from the levels of 0.7095 and 0.7157.
  • The NZD/USD pair didn't make any significant movements. There are no changes in our technical outlook.
  • The bias remains bullish in the nearest term testing 0.7238 or higher. The pair rose from the level of 0.7095 to a top around 0.7180.
  • The first support level is seen at 0.7157 followed by 0.7095, while daily resistance 1 is seen at 0.7194.
  • According to the previous events, the NZD/USD pair is still moving between the levels of 0.7157 and 0.7238. Currently, the price is moving in a bullish channel.
  • This is confirmed by the RSI indicator signaling that we are still in a bullish trending market. The price is still above the moving average (100).
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  • On the four-hour chart, immediate resistance is seen at 0.7194. Therefore, if the trend is able to break out through the first resistance level of 0.7194, we should see the pair climbing towards the daily resistance at 0.7238 to test it. It would also be wise to consider where to place stop loss; this should be set below the second support of 0.7049.
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Technical analysis of USDX for January 19, 2017

The Dollar index bounced as we expected towards 101 and a bit higher. Trend remains bearish as price remains inside the bearish channel and I believe this is another shorting opportunity for the Dollar index. I do not believe we have seen the lows in the index and we should prepare for new lows.

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Red lines - bearish channel

The Dollar index is trading below the Ichimoku cloud on the 4-hour chart. Short-term resistance is here at 101.50 and support at 101. Breaking below 101 will increase the chances of my bearish view for a new low towards 100.

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The Dollar index is re-testing the broken tenkan-sen (Red line indicator) on a weekly basis. Oscillators are overbought and turning lower. This is a bearish sign to me. Inability to break above the tenkan-sen will imply more downside should be expected specially if price breaks this week's lows. 99 remains my target.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of USD/CHF for January 19, 2017

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Overview:

  • The USD/CHF pair dropped sharply from the level of 1.0148 towards 1.0027. Now, the price is set at 1.0068. On the H4 chart, the resistance of USD/CHF pair is seen at the level of 1.0088 and 1.0148. It should be noted that volatility is very high so that the USD/CHF pair is still moving between 1.0088 and 0.9952 in coming hours. Moreover, the price spot of 1.0088 and 1.0148 remains a significant resistance zone. Therefore, there is a possibility that the USD/CHF pair will move downside and the structure of a fall does not look corrective. In order to indicate the bearish opportunity below 1.0088 and 1.0148, sell below 1.0088 with the first target at 0.9995 in order to test yesterday's bottom. Additionally, if the USD/CHF pair is able to break out the bottom at 0.9995, the market will decline further to 0.9952 in order to test the weekly support 2. However, it would also be sage to consider where to place a stop loss; this should be set above the second resistance of 1.0148.
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Technical analysis of gold for January 19, 2017

Gold price made a strong reversal yesterday, broke below $1,200 and exited the bullish channel. We could see a bounce to backtest the broken channel today but overall I believe Gold has made a short-term top and a pullback is justified towards $1,180.

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Red lines - bullish channel

Gold continues to trade above the Ichimoku cloud but the warnings from the divergence signs in the RSI came true yesterday and we saw a reversal in price. Gold is expected to continue its pullback towards $1,180 at least. Although I remain longer-term bullish about Gold, I believe traders should wait for $1,160-70 to buy Gold again.

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As expected Gold price reached the lower cloud boundary and got rejected. This was expected although technically it is not a good sign. I did not expect Gold price to break inside the cloud with the first try. I believe a pullback in Gold price will give the precious metal enough power to break to new highs. The oscillators on a weekly basis are just turning upwards so I'm confident we have much more upside in the longer term.The material has been provided by InstaForex Company - www.instaforex.com

Technical analysis of GBP/JPY for January 19, 2017

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GBP/JPY is expected to trade with a bullish bias above 139.95. The pair has crossed above its 50-period moving average, and is posting a rebound. The 20-period moving average stays above the 50-period one, and the relative strength index lacks downward momentum. Therefore, as long as 139.95 holds as the key support, look for a further rise to 141 and 141.70.

The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 141.00 and the second one at 141.70. In the alternative scenario, short positions are recommended with the first target at 139.45 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 141.70. The pivot point is at 139.95.

Resistance levels: 141.00, 141.70, 142.55

Support levels: 136.45, 136.10, 135.30

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Technical analysis of USD/JPY for Jan 19, 2017

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In Asia, today Japan will not release any Economic Data, but the US will release some Economic Data, such as Crude Oil Inventories, Natural Gas Storage, Housing Starts, Unemployment Claims, Philly Fed Manufacturing Index, Building Permits and the Fed Chair Yellen Speaks. So, there is a probability the USD/JPY will move with low to medium volatility during this day.

TODAY'S TECHNICAL LEVEL:

Resistance. 3: 115.28.

Resistance. 2: 115.05.

Resistance. 1: 114.83.

Support. 1: 114.55.

Support. 2: 114.32.

Support. 3: 114.10.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

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Technical analysis of EUR/USD for Jan 19, 2017

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When the European market opens, some Economic Data will be released, such as the ECB Press Conference, Minimum Bid Rate and Current Account. The US will release the economic data, too, such as Crude Oil Inventories, Natural Gas Storage, Housing Starts, Unemployment Claims, Philly Fed Manufacturing Index, Building Permits and the Fed Chair Yellen Speaks, so, amid the reports, EUR/USD will move in a medium to high volatility during this day.

TODAY'S TECHNICAL LEVEL:

Breakout BUY Level: 1.0678.

Strong Resistance:1.0671.

Original Resistance: 1.0661.

Inner Sell Area: 1.0651.

Target Inner Area: 1.0626.

Inner Buy Area: 1.0601.

Original Support: 1.0591.

Strong Support: 1.0581.

Breakout SELL Level: 1.0574.

Disclaimer: Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

The material has been provided by InstaForex Company - www.instaforex.com

Daily analysis of USDX for January 19, 2017

USDX recovered from Tuesday's lows and now it's heading toward the 101.06 level. The index is still trading below the 200 SMA at H1 chart and it looks like that could act as dynamic resistance across the board. However, all depends on which hints can bring Trump about fiscal policies and while the uncertainty remains there, the greenback can be under pressure. The next target to the downside is the 100.00 level.

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H1 chart's resistance levels: 101.06 / 101.76

H1 chart's support levels: 100.01 / 99.00

Trading recommendations for today: Based on the H1 chart, place sell (short) orders only if the USD Index breaks with a bearish candlestick; the support level is at 100.01, take profit is at 99.00 and stop loss is at 101.03.

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Daily analysis of GBP/USD for January 19, 2017

GBP/USD had a very corrective day during Wednesday's session, following the UK PM May's speech about Brexit on Tuesday, which helped to skyrocket the pair above the 1.2400 handle. Currently, it's testing the support zone of 1.2272, where a breakout lower should happen to test the 200 SMA around 1.2224 at H1 chart, while a rebound can deliver another buyers' wave to test the 1.2416 level.

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H1 chart's resistance levels: 1.2343 / 1.2416

H1 chart's support levels: 1.2371 / 1.2291

Trading recommendations for today: Based on the H1 chart, buy (long) orders only if the GBP/USD pair breaks a bullish candlestick; the resistance level is at 1.2343, take profit is at 1.2416 and stop loss is at 1.2268.

The material has been provided by InstaForex Company - www.instaforex.com