Analysis of GBP / USD Divergences for January 8th. The pound is preparing for a reversal after the euro.

4h

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The GBP / USD currency pair on the 4-hour chart continues the process of growth in the direction of the correctional level of 76.4% - 1.2812. A bearish divergence near the MACD indicator is brewing on January 8. Its education will allow traders to count on a reversal in favor of the American currency and a slight drop in the direction of the correction level of 100.0% - 1.2662. Rebounding quotes from the Fibo level of 76.4% will similarly work in favor of the beginning of the fall of the pair.

The Fibo grid was built on extremes from August 15, 2018, and September 20, 2018.

1h

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On the hourly chart, the quotes of the pair reversed in favor of the US dollar, after the formation of the bearish divergence at the MACD indicator, and began to fall in the direction of the correction level of 76.4% - 1.2725. The passage of the pair of the last divergence peak will work in favor of continuing growth in the direction of the correctional level of 100.0% - 1.2815. Fixing quotes above the Fibo level of 100.0% will increase the likelihood of further growth in the direction of the next correction level of 127.2% - 1.2916.

The Fibo grid is built on extremes from December 31, 2018, and January 3, 2019.

Recommendations to traders:

New purchases of the GBP / USD currency pair can be made with a target of 1.2815 and a Stop Loss order below the level of 76.4% if the pair bounces off of the level of 1.2725 (hourly chart).

Sales of the GBP / USD currency pair can be carried out with the target of 1.2725 and a Stop Loss order above the level of 100.0% if the pair bounces off of the level of 1.2815 (hourly chart).

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