Majors Attempting Correction!

Daily Forex Fundamentals | Written by Crown Forex | Nov 18 08 12:11 GMT |

Stocks continue to trade in the red as we head into Europe, while the heavy decline in UK headline inflation was a clear indication for the BoE's fears of undershooting the target over the medium term and to markets crucial sign that the recession is to be deep and protracted reiterating the ongoing fears that are shouldering markets, which continued the flee to safety and risk aversion which is again preventing the yen from reflecting the downside weight of recession its economy fell in. The Japanese yen against the dollar is reflecting conflicting signals as on intraday basis the downside move is about to end according to direction indicators while momentum indicators are reaching oversold areas which supports the upside move for the pair; if the downside wave continued the pair has to breach the 96 levels after it set its low so far at 96.20 while extending beyond that we see the lack of driving momentum will set the support level at 95.60 (which is the 23.6% correction for the latest downside wave) will hold the pair higher. From the upside the pair is still aiming at the 38.2% correction at 98.47 which will be valid to provide enough momentum for the pair to continue the downside since it couples with the major resistance for the downside channel which resides at 98.23 and failure to close on daily terms above those levels will keep downside targets valid which so far are set at 93.50 levels. Sterling is in need of an upside correction to gather momentum as the pair is still trading within oversold areas on a daily basis while direction indication according to the MACD are still solidly to the downside; yesterday the pair managed to rise after the lower Bollinger Band contained the downside move, while today the pair over intraday basis is providing mixed momentum signals which does not rule out the volatility for the pair. Managing to consolidate above the 1.50 levels will help the pair continue the upside correction which now faces at first strong resistance at 1.5280 levels, after that the pair has the 23.6% correction for the last downside wave at 1.5531 which is building further strength to contain the pair to the downside as the area is coupled with the major downside channel resistance at 1.5669 and the 20 Days MA at 1.5649 and as far as those levels are intact the upside correction will not cancel the downside over the medium term which is aiming now at 1.4314 levels. The euro is still fighting the technical pattern and is trying to break free amid conflicting signals; over daily basis the pair has more room to move higher and the downside wave is weakening as well over intraday basis, so far we are not going to assure that the upside correction will continue towards the 1.2920s unless a clear break through to the descending resistance is seen for the triangular model at 1.2747 which is preceded by the 20 Days Moving Average at 1.2719 while until then the breach is seen the pair's movement will continue to tighten and the upside will be watched unless a downside breach was seen and the pair steady trades below 1.2470s which will create a strong downside wave for the pair that at least targets 1.2320s its previous set lows. Crown Forex disclaimer:The above may contain information for investors/traders and is not a recommendation to buy or sell currencies, gold, silver & energies, nor an offer to buy or sell currencies, gold, silver & energies. The information provided is obtained from sources deemed reliable but is not guaranteed as to accuracy or completeness. I am not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trading currencies, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, gold, silver &energies presented should be considered speculative with a high degree of volatility and risk.