Technical Trading Tips and Techniques by 
(Please click on the accompanying chart to enlarge.)
As shown on the accompanying GBP/USD daily chart, recent price action within the last few days has brought price all the way up to approach a very significant support/resistance level in the 1.8500 region. This level was described in Friday’s Chart of the Day (click here to view). On a long-term basis, we can see that price has visited and turned at this level many times in the past. As of early Monday morning (New York session), price has come within pips of reaching this level before retreating. If 1.8500 is respected, a turn back down at or near this level should target support around the 1.8150 region. A strong break above 1.8500, on the other hand, should target further long-term resistance around the 1.8800 region.
UPDATE: As of early Monday afternoon in New York, price has broken out swiftly above the noted 1.8500 resistance level. Further upside should target the 1.8800 resistance, as noted above.
- James
James Chen is the Chief Technical Analyst at FX Solutions, a leading Forex broker. He is also a registered Commodity Trading Advisor (CTA) and a Chartered Market Technician (CMT) Level 3 candidate. At FX Solutions, Mr. Chen writes daily currency analysis, conducts forex trading seminars, and has authored numerous articles on currency trading and technical analysis for major financial publications. His upcoming book, Essentials of Foreign Exchange Trading