Tuesday, March 30, 2010
GbpUsd Since the worrying test of 1.4780 major support (1 March low) at the end of last week, GBPUSD has rebounded strongly with EURUSD and is now re-testing the downtrend vibration channel around 1.4985. Looking at the intersection between 1.4780 major support and the downtrend line, it is clear that a decisive breakout one way or another is imminent – indeed, we only have until the end of this week at the LATEST before crunch time. We are somewhat concerned that the bearish outlook in the medium term for GBPUSD’s cousin EURUSD in the may curse this break-out to come to the downside; a move which would make the pair vulnerable to a significant extension lower with very few support levels expected until 1.4516. The encouraging news for bulls is that if we do get a confirmed break above the downtrend, there is plenty of room on the topside until next resistance levels at 1.5115 (23 Mar highs), 1.5215 former resistance, and 1.5350 pivot level.