Possible Head & Shoulder Formation on GBPCAD

Colin Jessup

By: Collin Jessup

The GBP/CAD Daily Chart appears to be forming a head & shoulders formation, indicating that price could drop soon.  We have closed above a monthly support level of 1.6163 and price is indeed falling a few hours into the Asian session.  However we had a very strong bullish candle yesterday indicating prices could go higher.  If we break above 1.6225 resistance we could be heading for 1.6300 with a daily resistance zone at 1.6342.  

If however, we fall and break the support at 1.6163, we have support around 1.6080, 1.6040 and 1.5978 will be the next lower daily support zone.  The overall sentiment of this pair is indeed bullish with 9 of the last 10 trading days being bullish, but we are at a critical level.  Price action seems to be reacting positively to this level and could easily go higher.

 GBP/CAD Daily Analysis, September 30, 2011
Colin Jessup
Colin Jessup is certified in both Securities & Technical Analysis from the Canadian Securities Institute, founder of Omegatrader Canada and a Live Trading Coach at TheTradingCanuck.com, a service that calls live trades to captures dozens of pips daily with low drawdown.

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