Analysis of the divergence of GBP / USD on October 11. Divergence effect persists

4h

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The currency pair GBP / USD continues the process of growth in the direction of the correction level of 38.2% - 1.3316 after the formation of a bullish divergence in the CCI indicator. The end of October 11 quotations from the Fibo level of 38.2% will allow traders to expect a reversal in favor of the US currency and a slight decline in the direction of the correction level of 23.6% - 1.3067. New emerging divergences in the current chart are not observed in any indicator.

The Fibo grid was built according to extremums of April 17, 2018, and August 15, 2018.

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On the hourly chart, three bearish divergences were formed at once, and all of them were at the MACD indicator. Each of them allowed the pair to make a small fall, after which the growth process was resumed. As a result, the pair completed closing above the Fibo level of 76.4% - 1.3208 and, thus, the growth process can be continued in the direction of the next level of correction 100.0% - 1.3298. Fixing quotations below the Fibo level of 76.4% will work in favor of some fall in the direction of the correction level of 61.8% - 1.3153.

The Fibo grid was built according to extremums of September 20, 2018, and October 4, 2018.

Recommendations to traders:

New purchases of the GBP / USD currency pair can be made with the target at 1.3398 and the Stop Loss order under the correction level of 76.4% if the peak of the last divergence is completed (hourly chart).

Selling of the currency pair GBP / USD will be possible with the target of 1.3153 and a Stop Loss order above the level of 76.4% if the pair closes below the Fibo level of 1.3208 (hourly chart).

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