EURUSD-EUR closed lower (1.2789) yesterday reversing almost all its Wednesday gains. The pair remains under pressure as long as it maintains below 1.2830/1.2901 zone, its Sept 22’06 and Nov’06 highs with a test and possible break below 1.2765/47 zone, its Oct 03’06 high/Nov 08’06 low/.618 Ret likely especially now that the daily studies are negative and heading lower. If this happens, 1.2690/79 levels, its Nov 03 & 06 lows will come into play ahead of 1.2641/29 zone, its Sept’06 lows and Oct 19’06 high with a break and close below this zone targeting its Oct’06 lows at 1.2488/82. On the upside, a break of 1.2830/1.2901 levels, its Sept 22’06 high, .786 Ret and Nov’06 high will be needed to set the stage for a retest of its year-to-date high/psycho level at 12981/1.3000.If these levels give way, more upside gains could be seen towards 1.3126 level, its April’05 high before 1.3482 level, its Mar’05 high. On the whole, as long as EUR remains below 1.2830/1.2901 zone,its vulnerability to downside price losses can not be ruled out but a break back above the aforementioned levels will invalidate the immediate downside pressures and puts focus on a retest of its year-to-date high/psycho level at 1.2981/1.3000
Support Comments 1.2765/47 Oct 03’06 high/Nov 08’06 low/.618 Ret 1.2690/79 Nov 03 & 06 lows 1.2629/69 Sept’06 lows/Oct 02/04’06 lows 1.2560 July 26’06 low
Resistance Comments 1.2830/39 Sept 22’06 high/.786 Ret 1.2981 Year-to-date high 1.3126 April’05 high 1.3482 Mar’05 high
GBP Maintains Bearish Tone Below 1.8948
GBPUSD-GBP closed slightly lower at 1.8880 on Thursday bouncing off 1.8858 level,its Oct 20’06 high. The pair still maintains its bearish tone suggesting that further downside prices should be expected in the days ahead. In such a situation, the pair should target 1.8858 level, its Oct 20’06 high with a break required to set the stage for a push through 1.8777, its 4hrs rectangle price objective (yesterday analysis) ahead of its LT rising trendline/Oct 24’06 low at 1.8671/61.A close below this level should extend downside losses towards 1.8522/11 zone, its Oct’06 lows. Conversely, any bounce should be contained by 1.8948 level, its Nov 06’06 low which should now reverse roles as resistance and push the pair lower but a decisive break above this level, if seen, should see the pair pushing towards its short term (ST) broken rising trendline/late Aug’06 high at 1.9067/88 with a successful penetration aiming at 1.9143/77 zone, its Aug’06/Nov’06.If this strong resistance zone succumbs to upside pressures, its April’05 at 1.9218 followed by its Mar’05 at 1.9327 will come into play. Overall, GBP maintains downside bias as long as it trades below 1.8948 level. .
Support Comments 1.8858 .618 Ret/Oct 20’06 high 1.8739/33 Oct 17&18’06 highs 1.8671 Oct 24’06 low 1.8522/11 Oct’06 lows
Resistance Comments 1.8948 Nov 06’06 low 1.9088/67 Aug 31’06/ST broken trendline 1.9143/77 Aug’06/Nov’08 highs 1.9218 April’05 high
Mohammed Isah Independent Analyst Exclusively for Spencer Financial LLC misah@spencerfx.com
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