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Chart of the Day - 7/06/2010 – GBP/USD

(Chart courtesy of FX Solutions' FX AccuCharts. 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.)

7/06/2010 – GBP/USD – Price action on GBP/USD, a 4-hour chart of which is shown, has been entrenched in a clear parallel uptrend channel since the early June low.  Since that beginning of the bullish channel, price has made regular higher lows and higher highs, periodically breaking out above intra-channel downtrend resistance lines. Currently, after bouncing off the 38.2% Fibonacci retracement of the latest bullish channel run, price has just tentatively broken out above the latest of these downtrend resistance lines, this one extending from the 9-week high hit late last week. After this trendline breakout, price has consolidated as of Tuesday (7/06/2010) morning. In the event of a strong breakout above the noted 9-week high (in the 1.5225 price region), which would potentially continue the strong current uptrend, price could go on to target further key upside resistance in the 1.5350 price region.

James Chen, CMT
Chief Technical Strategist
FX Solutions

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