FX Technical Analysis

Daily Forex Technicals | Written by Mizuho Corporate Bank | Jan 20 09 08:17 GMT |

EURUSD Comment: Sliding below a very thin Ichimoku 'cloud' having given up almost 75% of December's rally. The Euro is oversold and momentum steadily bearish. Looking very unstable. Strategy: Stand aside if possible; if not, attempt tiny longs at 1.3025; stop below 1.2900. Target 1.3335. Direction of Trade: → Chart Levels: Support Resistance 1.3025 " 1.3104 1.3 1.32 1.2974 1.325 1.293 1.33 1.2845 1.3387* GBPUSD Comment: Dropping below the bottom of the downward-sloping 'wedge' formation to a low at 1.4132, Cable's lowest since March 2002. Surprisingly it is not especially oversold and on the Bank of England's index is holding above December's low point as other currencies (Russian rouble and Eastern European countries among others) weaken too. We shall watch for an imminent 'spike low'. Strategy: Stand aside but if you really have to: attempt tiny longs at 1.4175; stop below 1.4040. First target 1.4500/1.4550. Direction of Trade: → Chart Levels: Support Resistance 1.4132 " 1.425 1.409 1.43 1.4040* 1.44 1.3950/1.3930** 1.4441 1.3680* 1.4555 USDJPY Comment: Stuck in the middle of the range since December and creeping sideways into an apex and the lower edge of the Ichimoku 'cloud'. Very difficult to see where it might go next. Strategy: Trade the range between 90.00 and 91.50 keeping an open mind. Direction of Trade: → Chart Levels: Support Resistance 90.08 " 90.7 89.74 91 89 91.33* 88.89 91.56 88.48* 92.3 EURJPY Comment: Dropping from the bottom of the Ichimoku 'cloud' and the 9-day moving average, looking set to re-test trendline support. We expect it to hold again today although a brief break lower and 'spike low' some time this month cannot be ruled out. Strategy: Possibly attempt tiny longs at 117.45; stop below 116.00. Target 119.75, maybe 120.75 Direction of Trade: → Chart Levels: Support Resistance 117.00 " 118 116.5 118.82 116.24* 119.75 115.87 120 114.45 113.62** 120.75 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.