(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.)
4/26/2010 - EUR/GBP - Price action on EUR/GBP, a daily chart of which is shown, has once again dropped down to key support in the 0.8600 price region. This occurs after price broke down below a confluence of two uptrend support lines, one extending from the June 2009 low and the other extending from the July 2007 low. After that breakdown, price hit its downside support target around 0.8600 on Friday, but quickly corrected back up to re-test the trendline confluence. As of Monday (4/26/2010), as mentioned, price action has once again descended back down to approach 0.8600 support. If this key support level is subsequently broken to the downside, within the context of the current downtrend, price action could potentially target further significant support in the 0.8400 price region.
James Chen, CMTChief Technical StrategistFX Solutions
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