GBPUSD—clutching .382 support

What was left of my long stopped out at +10 pips in the move down from 1.5490. It's currently clutching the .382 retracement of the move from 1.4228 to 1.5998 and has actually dipped slightly below it with a low so far of 1.5304. The 50% line is at 1.5113. That's near the downward sloping channel line and the 100-day simple moving average. If one buys that scenario then shorting a rally or selling a decisive break of 1.53 are the way to go. There is positive divergence on the three-hour chart so a rally may be coming.

All this is happening within a larger monthly picture of a symmetrical triangle whose bottom, up-sloping line is in at 1.4431 and whose upper down-sloping line is at 1.6272. That leaves lots of room for price movement.

Resistance is at 1.5371, 1.5437, and 1.5492/1.5500. Support is at 1.5304, 1.5281, 1.5235, and 1.5113.

Here's the 3-hour 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.