Today's Cable chart is nearing a decision point. We can trade it short or long. Which way is best? How will you know?

The daily chart shows a major down-trend (starting November) that was broken to the upside in January.

The 4-hour chart shows a strong rally to an SK resistance level at 198.90 to 199.10

Now the decision is whether to trade this chart long based on the breakout of the long-term down-trend, or short because of the current resistance.

Let's look at both options. First the downward shorting option.

On the 4-hour chart I've drawn a supporting trend-line that needs to break before we can do any shorting. Shorts will have to be lower time-frames, below 60 minute, and only if the chart puts in consecutive lower swing highs and lower swing lows.

Also, there are some SK support levels at 198.50, 198.05, and also a little above 197.00 to 197.25 . Those support levels can be profit targets for intra-day short scalps, and may even be strong enough to support for a decent rally (watch out). If the chart can get below 197, it is even weaker, for more shorting.

For the upside possibility, for long trades, GBP/USD needs to rally above 199.00 and put in higher swing lows and swing highs intra-day. Then we can buy dips at Fibonacci levels, as long as the rally continues.

With these parameters, we are able to monitor this chart for opportunities in real-time.

Comments/suggestions/questions are welcome. Post your own charts, or your own trade suggestions too. We all benefit from the discussion. Discuss this chart on the TraderZine forum click here.