(Price on 1st pane, Slow Stochastics on 2nd pane; uptrend line in green; downtrend line in red; 200-period simple moving average in light blue.)

9/26/2008 – GBP/USD – Price action on the 4-Hour GBP/USD chart, as shown, is currently languishing in somewhat of a sideways consolidation, much like other major currency pairs.

As of Friday morning (New York session), price has been hugging a relatively well-defined uptrend support line (in green) after falling down off of a significant downtrend resistance line (in red). This downtrend line should continue to serve as resistance in the event of a pronounced bounce up off the current uptrend support.

In the event of a breakdown of the current consolidation, below the uptrend support line, key immediate support to the downside resides around the 1.8260-1.8270 zone.

James Chen

Chief Technical Analyst, FX Solutions

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