(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; chart patterns in yellow; Fibonacci retracement levels in grey; 50-period simple moving average in light blue.)
4/09/2008 GBP/CHF Since mid-2007, price action on the GBP/CHF daily chart, as shown, has been characterized by steep price drops along with marked consolidations. The current symmetrical triangle (represented on the chart in dotted yellow) is considerably well-defined, and is just the latest consolidation for this currency pair. Just as the previous four consolidation patterns in the current downtrend (triangle, triangle, horizontal range, and then flag) culminated in sustained bearish runs, the current triangle is hinting at more of the same. As of this writing, price is sitting on the very bottom of the triangle. A clean breakdown of this triangle with follow-through could present an opportunity to short the pair. In the event of this breakdown, the next clear support level to the downside resides at the last long-term low around the 1.9400 region, which is also approximately the lowest point of the current triangle.
Chief Technical Analyst
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