Today's Focus: EURUSD & GBPUSD
- EURUSD: Reverses Marginal Gains, Breaks To A New Low.
- GBPUSD: Continued Decline Shifts Focus To 1.7251 Level.
EURUSD
EUR reversed its Friday marginal upside gains Monday breaking lower and testing a low of 1.4054 before closing at 1.4137 at the end of the session. Focus remains on its Oct'07 low at 1.4015 though an early morning low of 1.4045 today is now being reversed. Below the 1.4015 level will put the pair in position to trade even lower towards its July'07 low at 1.3852.Higher time frame momentum indicators continue to support this view. On the other hand, if the mentioned intraday reversal is sustained, its resistance residing at the 1.4197 level, marking its Sept 05'08 low will be targeted ahead of the 1.4366/10 zone, its Jan'08/Dec'07 lows . While this scenario remains corrective of its recent declines, breaking and holding above the latter will call for more strength towards its Sept 08'08 high at 1.4429 and then its broken LT rising trendline at 1.4486.On the whole, while the broader bias remains to the downside, nearer term corrective recovery may be seen.
| Support | Comments |
| 1.4015 | Oct'07 low |
| 1.3852 | July'07 high |
| 1.3361 | Aug'07 high |
| Resistance | Comment |
| 1.4197 | Sept 05'08 low |
| 1.4366/10 | Jan'08/Dec'07 lows |
| 1.4429 | Sept 08'08 |
| 1.4486 | Broken LT rising trendline |
GBPUSD
An unsustained gain Monday saw GBP tumbled lower beginning another week lower and closing the session at 1.7596 after recording a fresh new low of 1.7471.Our medium term downside target lies at the 1.7251 level, its April'06 low with weakness through there setting the stage for further declines towards the 1.7130 level, its Dec'05 low before its Nov'05 low at 1.7067.However, persistent oversold condition and continued declines should support a nearer term corrective bounce argument. If this is seen, its Sept 05'08 high at 1.7744 will be aimed at with a clean break of there clearing the way for a run at its Jan'06/Sept 08'08 highs at 1.7935/76 and then the 1.8090 level, its Jun'06 low. This view remains corrective and GBP should turn lower continuing its broader medium term weakness on ending that recovery. All in all, having weakened persistently, odds of further declines continue to be envisaged with any recoveries at this stage seen as corrective.
| Support | Comments |
| 1.7251 | April'06 low |
| 1.7130 | Dec'05 low |
| 1.7049 | Nov'05 low |
| Resistance | Comments |
| 1.7744 | Sept 05'08 high |
| 1.7935/76 | Jan'06 high/Sept 08'08 |
| 1.8090 | Jun'06 low |
| 1.8176 | July 16'06 low |
Mohammed Isah
Market Analyst
www.fxtechstrategy.com
This report is prepared solely for information and data purposes. Opinions, estimates and projections contained herein are the author's own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness and neither the information nor the forecast shall be taken as a representation for which the author incur any responsibility. The does not accept any liability whatsoever for any loss arising from any use of this report or its contents. This report is not construed as an offer to sell or solicitation of any offer to buy any of the currencies referred to in this report
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