EUR Closes Slightly Below 1.2700 Levels GBP Gives Back Its Earlier Gains
EURUSD-Following its failure at 1.2756/65 levels, EUR put in a lower close yesterday bringing it to three days consecutive of lower closes. At the end of yesterday, EUR closed slightly below 1.2720/00 levels after pushing to a low of 1.2671.It continued to the downside in early morning trading today pushing below its three months trendline in place since July’06.This new development has now improved short term downtrend outlook bringing its Sept’06 lows at 1.2639/29 into focus. A sustained break of these levels is needed to further put pressures on the downside towards its July’26 low at 1.2560 ahead of its year-to-date low at 1.2459.In addition, the daily studies are in negative modes and pushing lower supporting the above view. However, if EUR fails below 1.2720/00 levels just as we have seen in the past few days, a push back above these levels followed with a retest of this week’s high at 1.2765 could be seen. All in all, EUR looks likely to push lower holding below 1.2720/00 levels.
Support Comments 1.2663/29 Sept’06 lows/.618 Ret (July-Aug rally) 1.2561/60 .786 Ret/July 26’06 low 1.2459 July’06 low 1.2360 April 19'06 low
GBPUSD-GBP sold off yesterday breaking back below 1.8821/00 levels/broken rising trendline to close at 1.8787 taking back almost all its Oct’02’06 gains. It was seen pushing to the downside towards 1.8632, its Sept 29’06 low at the time of this analysis. The new downside incursions put pressures on 1.8602 levels, its Sept’06 low. With the daily studies bearish and pushing lower, a break below 1.8602/00 levels may be achieved putting the next target at its July 26’06 low at 1.8389 ahead of 1.8175,its July’06 low. A risk to this analysis will be a break back above 1.8800/21 levels/broken trendline improving its chances of retesting this week’s high at 1.8997 and may be its Sept’06 highs at 1.9073/80.On the whole, as long as this pair remains below the above mentioned levels, downside price losses are expected.
Support Comments 1.8621/02 .50 Ret/Sept’06 low 1.8500/1.8489 .618 Ret/Round number 1.8389 July 26’06 low 1.8175 June’06 low
Resistance Comments 1.8821/00 50 Ema/Round number/Broken rising trendline 1.8929/18 Broken rising trendline/Sept 14’06 1.9088 Aug 31’06 high 1.9143 Aug’06 high
Mohammed Isah Independent Analyst Exclusively for Spencer Financial LLC
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