FX: Major Moves For The Majors

August 2008 | Market Strategy

Aside from the US$ dollar's bounce against the euro, a number of other long-term technical trends in the currency markets are currently taking shape. Perhaps the most significant to come into play so far this month relates to sterling. On the monthly US$/GBP chart, a major reversal pattern is in the making, indicating that a cyclical top could have been reached. Cable has already ploughed through near 2-year resistance at the neck-line of the formation, and a close below US$1.9399/GBP would augur major potential downside. A move as far as US$1.7200/GBP could be in store over a multi-year time horizon.

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