EURUSD-EUR continues to maintain its short-term bearish bias reversing its Monday gains yesterday and pushing to a new low of 1.2953 in early morning trading today. The pair remains vulnerable to further downside pressure as long as it holds below 1.3052/68 levels putting downside price target on such a continued weakness at 1.3000/1.2953, its Jun’06 high/Jan’07 low/.618 Ret/psychological level. On a successful clearance of these levels, the pair should push towards its next support levels seen at 1.2901/24, its Nov 10’06 high/.50 Ret (1.2484-1.3365 rally) with a break opening the door for more weakness aiming at 1.2830/12, its Sept 22’06 high/.618/double top price target ahead of its Oct 03’06/Nov 17’06 highs at 1.2765/61.Although oversold condition is now a factor on the daily chart, its weekly studies are negative and heading to the downside suggesting that more downside losses should follow if a correction to unwind this condition(oversold) is seen. On the other hand, its double top breakdown point/50 ema/Dec 18’06 low at 1.3052/68 comes in as its technical resistance where a loss if it occurs could reduce the downside pressure and put the pair in position to push towards its Dec 11’06 low/April’05 high at 1.3126/30 followed by its Dec 20’06 low/broken rising trendline/.786 Ret (1.3667-1.1640 decline) at 1.3221/45 enroute to of 1.3292/95 levels, its Dec 12’06/Jan 02’07 highs and its Dec’06/20-month highs at 1.3365.On the whole,EUR remains under pressure and looks to push lower.
Support
Comments
1.3000/1.2981
Psycho level/Jun’06 high
1.2901
Nov’10’06 high
1.2830/24
Sept 22’06 high/.618 Ret
1.2761
Nov 17’06 low
Resistance
Comments
1.3052/68
50 ema and Dec 18’06 low
1.3126/30
April’05 high/Dec 11’06
1.3231/45
.786 Ret(1.3667-1.1640)/ Dec 20’06 low
1.3292
Dec 12’06 high
GBP Looks Beyond Its MT Rising Trendline
GBPUSD-After a follow through to the upside in early morning trading on Tuesday testing a high of 1.9456, GBP gave back those gains and closed at 1.9387 forming a hammer candle pattern at the end of the day. Pressure to the downside in the short term remains in place in this pair, as such holding below the 1.9410/60 levels calls for weakness targeting its .382 Ret/Mar’05 high at 1.9327/37 ahead of its MT rising trendline(established since Oct’06)/ Jan’07 low at 1.9293/62.If these levels give way,GBP should continue to weaken towards its April’05 high/Nov 10’06 high at 1.9218/1.9177 with room for further price losses towards its .618 Ret (1.8522-1.9848 rally)/psychological level at1.9027/00 and its Nov 17’06 low at 1.8834.Momentum on the weekly chart supports this view. On a failure to push lower at the present level, its immediate upside barrier is seen at its 50 ema/Dec 18’06 low/range breakdown point at 1.9410/60 with the next two technical upside targets at its Dec’04 high at 1.9552 and its Dec 13&20’06/Jan 03’07 highs at 1.9727/50 before its 14-year high at 1.9848 set in early Dec’06.On the whole, as long as the overhead resistance created by the loss of 1.9410/60 zone holds,GBP should continue to face downside pressure.
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