Forex Trading Technical Analysis (2010/08/16) GBP/USD Consolidates Near Bottom of Uptrend Channel
(Please click on the forex chart thumbnail to enlarge)
8/16/2010 Forex Trading Technical Analysis (FXpath.com) – GBP/USD (a 4-hour chart of which is shown) as of Monday (8/16/2010) has bounced up off key 1.5550 support, also the bottom of an important uptrend channel extending back to the May lows, and then rose to hit key resistance at 1.5700 today before retreating. Still within the context of the strong uptrend channel, price has been consolidating sideways for the past couple of days between the two noted levels – 1.5550 and 1.5700. Any strong break of this consolidation should lend a stronger directional bias going forward. A strong breakout to the upside above 1.5700 would confirm an uptrend channel continuation that could then go on to begin targeting the 1.6000 price region once again. Conversely, a strong break to the downside below the channel and below 1.5550 could presage a trend change with an immediate downside support target in the 1.5450 price region.
(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)
James Chen, CTA, CMT (bio)
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