FX.co ★ GBP/CHF candlestick analysis for January 26, 2011

Earlier on a 4-hour graph the GBP/CHF has formed candlestick combination Falling Three Methods, which indicates downside movement, confirmed further.
The breakthrough of the support level 1.5100 and the Fibonacci correction level 38.2 proves this viewpoint.
At the moment the pair is testing the support level 1.4850. If it is broken, downside movement targeted at 1.4400 should be expected.
This candlestick combination shows that the currency pair had been demonstrating upside movement for several weeks after an unsuccessful attempt to break the support level 1.4400. However, it reversed near 1.5400. This implies that the bears became more active at this point and the bulls could not solidify here.
It is worth mentioning that stop loss should be placed slightly above 1.5192 as the breakout of this level will target the GBP/CHF to 1.5400.