Price action on GBP/USD (a daily chart of which is shown) as of Monday (3/29/2010) morning New York session has continued its rebound off key support just below the significant 1.4800 price region. This rebound hints at a possible double-bottom in the making. Any strong breakout and daily close significantly above 1.5000 would lend further strength to the potential for a double-bottom formation. In this event, the key upside level to watch would be the 1.5380 price region, which represents the peak of the double-bottom. To the downside, a significant breakdown below 1.4780 would invalidate the double-bottom and could then potentially target key further support around 1.4500.
- James Chen, CTA, CMT
* For information on my DVD set, High-Probability Trend Following in the Forex Market, please click here.
* For information on my book, Essentials of Foreign Exchange Trading (Wiley), please click here.
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