Daily Chart Art – October 22, 2009

GBPUSD: 1-Hour

PoD Chart

Let’s start with a follow-up on the Cable. There was a moment when the pair broke below its ascending trend line and the 1.6400 support. Though, it managed to regain its footing several hours after to push its way above 1.6400 again. It used this level as a springboard to catapult itself back above the ascending trend line. Presently, the pair is hovering just above the 1.6600 handle. If this level holds, the pair could reach 1.6700. On the other hand, it could find its way down to 1.6500 if 1.6600 breaks.

AUDUSD: 1-Hour

PoD Chart

Next is the AUDUSD on the 1-hour chart. As you can see, the ascending trend line held strongly as the pair attempted to break below it yesterday. It bounced off the trend line a couple of times before shooting to a high of 0.9328. Right now, the upward price action seems to be pulling back a bit. The pair could retreat all the way back to retest the ascending trend line or it could dip until the previous day low, which coincides with the psychological 0.9200 handle. If it resumes its upward movement, it could encounter resistance at the previous high of 0.9328, which is this pair’s newest yearly high.

USDJPY: 4-Hour

PoD Chart

Now, let’s head over to the USDJPY 4-hour chart. There seems to be an area of interest at the 90.30 area, which previously served as support level for the pair. The pair took a sharp dive and broke below this level, which then turned into a resistance level, and found support at 88.25. The pair moved within this range for quite a while until it pierced above the resistance level a few days ago. The stochastic is currently making its way towards the overbought region, indicating that the price may head lower sooner or later. The 90.30 area could once again serve as a support level for the pair but if it fails to do so, the pair could tumble all the way down and bounce from 88.25. But note that a couple of psychologically significant levels are just along the way and the downward price action could reverse upon hitting these levels.