Forex Technical Update

Previous: GBP/USD Testing Channel Support at 1.56 (6/21)

GBP/USD Chart Day 6/25/2012 9:43PM EDT

GBP/USD

In the daily chart, the GBP/USD is breaking below a flag pattern that stalled the bearish trend since the end of April/beginning of May.

This came after the RSI resolved oversold conditions (but remained bearish by staying below 60), and also came after a test of the 200-day SMA as resistance. With regards to the moving average cross-over and confirmation, you can say the market is in a slingshot to the downside.

Now we are looking for at least the June lows of 1.5280 and maybe even the 2012 low near 1.5240.

The 4H chart shows a closer look at the break below 1.56. By no means is this a strong breakout, and the sterling seems to be more resilient than the EUR and AUD but eventually caught up in breaking June's corrective pattern.

The 4H chart also shows that before the 1.5280-1.53 lows, there is a support pivot area around 1.5455.

GBP/USD 4H chart 6/25/2012 9:40PM EDT

GBP/USD

Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.