Daily Technical Strategist

Daily Forex Technicals | Written by FXTechstrategy | Oct 09 08 13:06 GMT |

Today's Focus: EURUSD & GBPUSD

* EURUSD: Nearer Term Corrective Recovery Targets A Retest Of The 1.3852/82 zone
* GBPUSD: Bounces Off Intra Day Low, Trades Above The 1.7447 Level

EURUSD

As positive higher closes continue to be seen since a low of 1.3443 was printed on Oct 06'08, further upside follow through on the pair's present corrective recovery looks to push towards a retest of its support turned resistance zone at the 1.3852/82 zone, its Sept 11'08 low/July'07 high where a cap is expected to turn the it lower again. Above here though not expected should pave the way for a run at its Oct'07 low at 1.4015 and then its Sept 16'08 low at 1.4073.The pair's positive RSI divergence seen on the daily chart remains supportive of its nearer term corrective price action. On the other hand, initial support lies at the 1.3682/66 zone, its April'07/Dec'04 highs followed by the 1.3443 level, its YTD low ahead of its Dec'04 high/August'07 low at 1.3366/61.Clearing the latter will set the stage for a move towards the 1.3312/1.3264 zone, its .618 Ret (1.1640-1.6038 rally)/Jun'07 low. On the whole, although corrective recovery higher has taken hold of the pair now, this is seen as temporary as its medium term trend is clearly pointing to the downside.

Support Comments
1.3682/66 April'07/Dec'04 highs
1.3366/61 Dec'04 high/August'07 low
1.3312/1.3264 .618 Ret (1.1640-1.6038 rally)/Jun'07 low
1.2980 Jun'06 high

Resistance Comments
1.3852/82 Sept 11'08 low/July'07 high
1.4015 Oct'07 low
1.4073 Sept 16'08 low

GBPUSD

GBP reversed its intra day gains on Wednesday printing its lowest price since Jan 2006 and closing below its April'06 low at 1.7251.With the resumption of its medium term triggered, its Nov'05 low at 1.7049 is now being eyed ahead of its June'03 high at 1.6857.We continue to see the 1.7049 level as a critical one as a break and close below there will wipe out its entire Nov'05-Nov'07 rally and activate its longer term downtrend(monthly chart).On the upside, resistance levels are now seen at the 1.7447 level, its Sept 11'08 and the 1.7735 level, its Sept 16'08 low with a penetration of there calling for additional upmove towards the 1.7976 level, its Sept 08'08 high. In short, having closed lower and resumed its medium term downtrend, activation of its longer term weakness is expected if a decisive break and close below the 1.7049 level is seen.

Support Comments
1.7251 April'06 low
1.7049 Nov'05 low
1.6857 June'03 high

Resistance Comments
1.7447 YTD high
1.7735 Sept 16'08 low
1.7976 Sept 08'08 high
1.8123 Sept 15'08 high

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