FX Technical Analysis

Daily Forex Technicals | Written by Mizuho Corporate Bank | Aug 20 08 06:20 GMT |

EURUSD Comment: A small 'bullish engulfing' candle yesterday here and something similar in a series of other currencies adds weight to our view that the Euro is trying to form a slow interim base against retracement support. For today we ought to hold above 1.4685, probably with a cautious upside probe to 1.4800/1.4850. Strategy: Attempt longs at 1.4765, adding to 1.4665; stop below 1.4600. Short term target 1.4800 and then 1.5000. Direction of Trade: → Chart Levels: Support Resistance 1.4753 1.4807 1.4698 1.4860 1.4655 1.4915 1.4630* 1.4980/1.5000** 1.4600 1.5084 GBPUSD Comment: Small signs that Cable is finding its feet with the first up-day after twelve consecutive down-days. The verdict? Could do better. Over the next fortnight we expect a messy attempt at basing followed by a bounce to 1.9000. Strategy: Attempt longs at 1.8635; stop below 1.8500. Short term target 1.8700, then 1.8800. Direction of Trade: → Chart Levels: Support Resistance 1.8619 1.8688 1.8538 1.8723 1.8510* 1.8800* 1.8400 1.8900 1.8300 1.9035/1.9050* USDJPY Comment: Slightly unsteady as we work in a sort of upward-sloping 'wedge' formation. We are still looking for signs of topping at the 110.00/110.50 pivotal chart area. A daily close below 109.25 might add a little bearish pressure. Strategy: Attempt shorts at 109.75, adding to 110.35; stop above 110.75. Short term target 109.55 then 108.55. Direction of Trade: → Chart Levels: Support Resistance 109.62 109.91 109.55 110.35 109.31 110.55/110.67* 108.50/108.35* 111.00 107.85 111.50 EUR/JPY Comment: Retracing half of the previous big rally, holding clearly under the 'broadening top', and likely to move sideways today. Late this week or late this month we expect a drop to 158.00, and further out a slide to 152.00. Below here and the long term picture gets seriously interesting. Strategy: Sell at 162.25, adding to 163.65; stop above 164.00. Short term target 161.00/160.60, then 158.00. Direction of Trade: →↘ Chart Levels: Support Resistance 161.80 162.38 161.40 162.65 161.00/160.86* 163.12 160.60 163.85/164.00* 160.00 164.50* Mizuho Corporate Bank Disclaimer The information contained in this paper is based on or derived from information generally available to the public from sources believed to be reliable. No representation or warranty is made or implied that it is accurate or complete. Any opinions expressed in this paper are subject to change without notice. This paper has been prepared solely for information purposes and if so decided, for private circulation and does not constitute any solicitation to buy or sell any instrument, or to engage in any trading strategy.