There was a lot of news around today with both the UK and Europe cutting interest rates, but today I want to show you an example of a classic intraday breakout that occurred today on the GBP/USD pair.
On the chart below you will see that the GBP/USD touched the support line (blue) of 1.4130 on three separate occasions before finally smashing through this support line at around 11.20. You will often find these breakouts have a lot of momentum behind them as so many traders around the world all notice the same breakout and jump on board.
This was certainly the case on this occasion because after dropping below the pivot point (black) it then, possibly helped by the interest rate decision, fell all the way down to the first support line (green). This is an obvious point to close out positions and those traders who hadn't already done so will inevitably have closed out here because the price then bounced upwards from this support line.
So this is an example of how you can trade the currency markets on an intraday basis using nothing more than simple support and resistance lines.
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