Monday, June 15, 2009

GBP/USD - Possible Double Top

GBP/USD Daily chart - there is a possible Double Top in progress.

The wide range 1.66 - 1.60 has a Supportive base in the 1.58 - 1.60 area. This is obvious from the accumulation range in the end of May and the June 08, Key Reversal Candle shadow.

The possible scenario if we see a decisive breakdown of the 1.60 and a close below is to observe a range rotation of the same extent to the other side of the fulcrum level. That is a measured move taking the 1.66-1.60 (600 pips) down from 1.60. So the target is 1.54 which happens to be right above the 200-Day MA (1.5375 presently).

Other Support levels are the bottoming out pattern breakout Resistance levels 1.50 and 1.5350. However let's observe the market reaction and act accordingly rather then divine the unfathomable future.

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