(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.)
3/25/2010 - GBP/USD - Price action on GBP/USD, a daily chart of which is shown, has broken down cleanly below both the key 1.5000 price region and a short-term uptrend support line extending from the early March low. This occurs within the context of a strong downtrend in the pair. As of Thursday (3/25/2010) morning New York session, price made a bullish retracement of yesterday's substantial drop, but was rejected by the key 1.5000 level almost precisely at the round figure, and then dropped back down to re-test yesterday's lows. The directional bias for this pair continues to be bearish in line with the strong overall downtrend. With continued bearish momentum, an immediate downside support target resides around 1.4780, which represents the early March long-term low. A breakdown below that price area would confirm a strong downtrend continuation and potentially target further major support in the 1.4500 price region.
James Chen, CMT
Chief Technical Strategist
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