EURUSD-EUR extended its downside losses on Friday pushing below its April’05 high/ Dec 11’06 low at 1.3130/26 and reversing its Monday and Tuesday upside gains to close the week at 1.3085.With a failure at higher level prices combined with a loss of 1.3231 and 1.3130 support levels,EUR looks set to push for further downside prices. In such a development, its first technical support comes in at 1.3059, its MT rising trendline followed by its Jun’06 high/psychological level at 1.3000/1.2981. This zone is expected to revert to support and put the pair in position to push for higher prices but if a breach of this zone is seen, further weakness targeting its Nov 10’06 high/Aug’06 high at 1.2901/39 should follow with a break triggering losses towards its Nov 17’06 low at 1.2761.Additionally,daily studies and weekly RSI point lower supporting this view.However,on any strength from, its April’05 high/Dec 11’06 at 1.3126/30 eroded on Friday should reverse roles as resistance and put further pressure on the downside. A loss of these levels will open the way for upside gains aiming at its .786 Ret where a break and close above here would set the stage for an attack on its 20 months high at 1.3365 set in Dec’06.Beyond here lies its 1.3405, its range breakout price target ahead of its April’05 high at 1.3482 and its Dec’04 high at 1.3667.On the whole, as long as EUR gains remain capped by 1.3130/3231 resistance levels, further downside pressure is expected in the days and weeks ahead..
Support Comments 1.3059 MT rising trendline 1.3000/1.2981 Psycho level/Jun’06 high 1.2901/39 Nov 10’06 high/Aug’06 high 1.2761 Nov 17’06 low
Resistance Comments 1.3126/1.3086 April’05 high/Dec 08’06/Nov 27’06 lows 1.3219/31 Nov 28’06 high/.786 Ret(1.3667-1.1640) 1.3365 Dec’06 high 1.3405 Broader range breakout price target
GBP Tests Lower Prices
GBPUSD-GBP made a run to the downside on Friday breaking below its Dec’04 high at 1.9552 and reversing almost all of its earlier upside gains on Monday and Tuesday to close at 1.9516. Downside pressure remains a factor as long as the 1.9552 and 1.9730 levels hold suggesting that more downside prices should be seen. Targets on the downside on such weakness are its Dec 08’06 low/.382 Ret/Nov 29’06 low at 1.9465/34 and its Mar’06 high/Nov 27’06 low at 1.9327/06.Below here targets its April’05/Nov 10’06 highs at 1.9218/1.9177 and probably lower if a break occurs. The daily studies and weekly RSI are negative and heading lower supporting this view. On the upside, its immediate target comes in at its Dec’04 high at 1.9552 followed by 1.9726, its Dec 08’06 high with scope for extension towards its 14 years high at 1.9848.A stronger resistance is seen at its psychological level at 2.000.On the whole, GBP looks to push lower in the short term but as long as it can hold above the 1.9177 level, it is expected to continue its long-term uptrend.
Support Comments 1.9327/06 Mar’05 high/Nov 27’06 low 1.9218 April’05 high 1.9177 Nov 10’06 high 1.8834 Nov 17’06 low
Resistance Comments 1.9552 Dec’04 high 1.9726 Dec 08’06 1.9848 Dec 01’06 high 2.000 Psychological Resistance
Mohammed Isah Independent Analyst Exclusively for Spencer Financial LLC misah@spencerfx.com
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