Monday, May 24, 2010

GBPUSD—weekly chart

GBPUSD has still not dropped to its 2009 lows and it looks as though it’s trying to base with the doji formed on the weekly chart. The low of this doji is 1.4228. A break below that does bring those 2009 lows into sight and one could short the break with a tight stop. It’s worth noting that the pair has dropped below the weekly close of 1.4460. So far this morning it has also broken below a short-term uptrend line. Finally, as I blogged last week, the pair has broken below a lon-term uptrend line on the monthly chart. All of this points to continued weakness and shorting rallies or a clear break below 1.4228 is the way to go.

Support is at 1.4229, 1.4110, 1.3826, 1.3654, and 1.3503. Resistance is at 1.4440/60/76, 1.4529, 1.4640, 1.4703, 1.4851, 1.4889, 1.4918, 1.5055, and 1.5173.

Here’s the weekly chart:

© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.

My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.

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