Hey all,

Not often I write about something that hasn't happened yet, but there is some interesting levels to keep an eye on for the GBP/USD today and tomorrow. Below is the 1H chart of the GBP/USD:


I have marked three main things, firstly, a trend line drawn from the daily timeframe, showing a daily downtrend (thick purple line), secondly a previous support which has now become a resistance line (thick horizontal line), and then the 1H trend line (thin purple line). It is interesting because both trend lines have held numerous times now, showing a battle between long and short term traders, while the possible change in polarity (support becoming resistance and vise versa) indicates to me things may be switch in the short term.

Personally I will be looking to short again around that daily trend line if there is a sign of a slowdown in the upward move as I view long term trend lines to hold more importance. If the 1H trend line can be broken to the downside, I expect a strong move down to some previous support levels of around 1.7260 in the short term, or 1.7215 in the mid term.

Happy trading!

This entry was posted on Wednesday, December 07, 2005 at 6:46:00 AM. You can skip to the end and leave a response.