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| GBP/USD Drops to Approach Critical Support Posted: 10 Jun 2011 08:54 AM PDT  GBP/USD (daily chart) as of Friday (6/10/2011) has dropped substantially to approach a confluence of key support factors, including the 1.6200 support price region, the 38.2% Fibonacci retracement of the last major bullish trend run, and an important long-term uptrend support line extending back to the May 2010 lows. Price action is therefore at a critical juncture once again. In the event of a significant breakdown below the current support confluence, which would jeopardize the longstanding bullish trend for GBP/USD, a key initial downside support target resides around the psychologically-important support/resistance level at 1.6000.
(Please click on the chart to enlarge. Chart key: price on 1st pane, Stochastics on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average in orange; 100-period simple moving average in brown; 200-period simple moving average in dark blue; Fibonacci levels in magenta and purple.) James Chen, CTA, CMT
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| EUR/USD Third Consecutive Bearish Day Posted: 10 Jun 2011 06:51 AM PDT  EUR/USD (daily chart) as of Friday (6/10/2011) has continued its bearish stance of the last two days after attempting but failing to break 1.4700 to the upside earlier in the week. This continued bearishness now constitutes a bonafide breakdown of the steep uptrend that has been in place since late May. A key downside support target on this breakdown resides around the 1.4250 price region, which is not only an important prior support/resistance level, but also the 61.8% Fibonacci retracement level of the two-week bullish run from the lows around 1.4000 to the highs around 1.4700. In the event of continued bearish momentum that further breaks down below the noted 1.4250 support, the key downside target to watch is clearly around the 1.4000 psychological level, which has served as an exceptionally strong support/resistance level and price target in the recent past.
(Please click on the chart to enlarge. Chart key: price on 1st pane, Stochastics on 2nd pane; horizontal support/resistance levels in black; uptrend lines in green; downtrend lines in red; 50-period simple moving average in orange; 100-period simple moving average in brown; 200-period simple moving average in dark blue; Fibonacci levels in magenta and purple.) James Chen, CTA, CMT
 This posting includes an audio/video/photo media file: Download Now |
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