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12.01.2016 11:56 AM
GBPUSD technical analysis for January 12, 2016

GBP/USD remains in a strong down trend inside a bearish channel, but there are signs that bears should be very cautious as I believe around 1.4450 we should expect a big reversal and strong bounce in this pair.

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GBPUSD is trading inside a bearish channel as shown in the 4-hour chart above. Trend remains bearish as price is trading below the Ichimoku cloud and both the tenkan- and kijun-sen indicators. Stochastic oscillator is oversold providing some bullish divergence signals. Beas should protect their profits if price breaks above 1.4610. Downward target is at 1.4450.

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In the weekly chart we also find oversold oscillator readings. A bounce towards 1.52 is possible although bulls will first have to break above 1.46-1.4650 in order to regain short-term control of the trend. Concluding, bears are in control but I believe they should protect their short positions by lowering their stops as a bounce is expected.
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