The GBP/USD bears need a pause | 21 July 2014

Euro

The latest Mrs. D. Yellen speech was very positive for the dollar, despite the shortcomings identified in the U.S. economic recovery. During her speech, Yellen J. stressed that the labor market embarked on a path of recovery, inflation is stable and is controlled by the Fed. The dollar began to strengthen against euro.

The euro/dollar consolidated in a narrow range between the support near 1.3480 and the resistance at 1.3535.

The support levels are 1.3460- 1.3480, and the resistance levels are 1.3535 - 1.3555.

MACD is in a negative territory.

Trading recommendations

Attempts to recover towards 1.3600/18 should be used as an opportunity to open short positions. The rising above the last level will weaken the downward pressure.

Pound

In the absence of interest news from the UK traders will work out this moment when the British currency is technical oversold and therefore can be expected to develop a moderately rising trend.

"Bears" are trying to develop a downward correction. The pair dropped to 1.7070 which successfully limits their attacks.

The support levels are 1.7050 - 1.7070, and the resistance levels are 1.7170 - 1.7190.

MACD is in a neutral territory.

Trading recommendations

"Bulls" are going to go back and consolidate above the 71st figure, however, the restore attempt is limited by the local resistance at 1.7115.

While the pair is trading above 1.7054, the risks of renewed growth and testing current maximums will be preserved. The loss of this support will weaken the upward trend.

Yen

Japanese exporters have some difficulties as the strong national currency is not good for them.

In the light of this they will try to strengthen the U.S. dollar. Against this background it is possible to buy the pair at 101.00 and 101.82 and take profits at resistance levels.

The dollar/yen once again broke the support at 101.40, tested and broke the support at 101.22, but again failed to consolidate below it.

The demand near the level of 101 returned the pair above this level, still the "bulls" are trying to move up.

The support levels: 100.80- 101.00, and the resistance levels: 101.70- 101.90.

The MACD indicator is in a negative territory.

Trading recommendations

The bears’ inability to consolidate below 101.22 increases the risk of forming a base that will be followed by the uptrend resumption. The growth above 101.59 and the resistance of 101.79 breaking will signal for this.