Could GBP vs. USD go to parity?

[Aurum]

I was looking at long term charts and when I looked at the monthly GBP/USD chart I noticed a rather disturbing pennant. The drop before the pennant starts around $2 and the pennant is around $1.50 which would give a target range around $1. Does anyone think this is likely?
GBPUSD chart.jpg

Mike.

[Aurum]

Forgot to ask, are pennants even valid over this time scale? If not then what would you call this pattern?

Thanks,

Mike.

[cogs]

Forgot to ask, are pennants even valid over this time scale? If not then what would you call this pattern?

Thanks,

Mike.

I can see it also. With the schooling and experience I have received over the past 15 years, yes these type of patterns have even more meaning over longer time frames, of course they should be traded in that time frame also.

Longer time frames are always more accurate for longer periods of time, if that makes sense, hence more time to take your best position. Nothing is ever gauranteed though and these need to be looked at in conjunction with accurate volume.

Just my bit.

[TulipFX]

I don't know about parity, but two fundamentals suggest there could be downside - US elections could strengthen USD and British banks are getting run through the ringer ATM.

All a guess though. Only time will tell.

[OGRooney]

I'm only new at this, but in my opinion, the trend turned Bullish for both the Sterling and our Dollar in late June/early July, when their correlations with EUR/USD went out the window.

As far as the prevailing GPBUSD trend is concerned, how could you call it bearish when the July 2010 low has held for 2 years and counting? That's some serious Bullish support - whether technical or psychological. The lower tops are there but the lower low's just aren't, in fact, the opposite; major lows have been getting steadily higher since September 2008. As such, I'd be hesitant to even declare a prevailing trend. I guess we'll see what the pair does over the next few weeks/months, but either way, I think the case for parity is pretty damn weak.

gpbusd monthly 26 july 2010.gif

Trendline Colour Key:
Blue - Confirmed Bullish
Light Blue - Unconfirmed Bullish
Red - Confirmed Bearish
Grey - Invalidated Bullish/Bearish

[cogs]

Looks like that penant is about to be broken to the up side, orrr a nice short entry in the rollover?

Just about anything is possible in this game.

[>Apocalypto<]

I was looking at long term charts and when I looked at the monthly GBP/USD chart I noticed a rather disturbing pennant. The drop before the pennant starts around $2 and the pennant is around $1.50 which would give a target range around $1. Does anyone think this is likely?
GBPUSD chart.jpg

Mike.

QE3 just out so could complicate the pattern... so how much long term legs this FED move gives the markets...

[cogs]

Have seen so many flags turn into floors in the past year or 2.

I had several longs but am holding onto a late one at 1.60278, see what I can get out of it.

Next stop 1.63 ish then 1.642

[cogs]

So that pennant is proving legit, (so far).

Next stop?

GBPUSD.png

[Aurum]

GBPUSD chart1.png
It has indeed broken quite convincingly to the downside and set a new 2.5 year low. Next major support at 1.423 - may even get to parity yet but probably not until around September time. Must say, I didn't expect it to take another 8 months after I started this thread.

Mike.

[TulipFX]

Parity is still a llllllooonnnggg way off. It would need to drop approximately 1/3 of its value, a big move which would require some major negative fundamental news

[Aurum]

Parity is still a llllllooonnnggg way off. It would need to drop approximately 1/3 of its value, a big move which would require some major negative fundamental news

Well, tonight we have UK growth numbers (GDP) and also Italy is auctioning a few billion Euro of 10 Year Bonds. These two events may be the push it needs to send it on its merry way. Up or Down is your guess. I know which I'm expecting.

Should be an interesting few months.

Mike.