Daily Technical Strategist

Daily Forex Technicals | Written by FXTechstrategy | Feb 20 09 08:08 GMT |

Today's Focus: EURGBP &USDJPY EURGBP: Momentum Remains To The Downside USDJPY: Closes In On The 94.62 Level EURGBP While a loss of momentum at the 0.9073 level, its Feb 12'09 high has turned the cross to the downside in line with its short term downtrend triggered off the 0.9803 level, successfully invalidating the 0.8663/38 levels, its Nov 13'08 high/Feb 10'09 low is required to resume that trend. Although a bounce higher was seen on Thursday, the above scenario puts EURGBP's focus to the downside. Below the 0.8663/38 levels will turn attention to its .618 Ret(0.7694- 0.9803 rally) at 0.8502 and then the 0.8236 level, its Nov 28'08 low will be targeted. This view remains supported by its ST falling channel. However, above the 0.9073 level must be traded to resume its upmove triggered at the 0.8638 level towards the 0.9128/24 area, its Jan 14/13'09 highs. Beyond the latter will accelerate gains towards its Jan 20'09 high at 0.9325 and next its swing high at the 0.9521 level, its Jan 26'09 high. On the whole, while corrective upmove continues to dominate the cross's price, its overall short term outlook remains lower. Support Comments 0.8844/38 Jan 09/16'09 lows 0.8663/38 Feb 12'09 low/Nov 13,08 high 0.8569 Nov 17'08 high Resistance Comments 0.9128/24 Jan 14/13'09 highs 0.9325 Jan 20'09 high 0.9521 Jan 26'09 high USDJPY Continued upside offensive saw the pair breaking higher and testing a high of 94.46 Wednesday, a few pips from its key resistance at the 94.62 level, its Jan'09 high. Although USDJPY closed higher above the 94.00 level, decisively eroding the 94.62 level is now expected as that will confirm a double bottom chart pattern. Upside price target for such a break is located at the 102.22 level. But the pair will have to overcome the 97.43 level, its Nov 24'08 high and the 100.55 level, its Nov 04'08 high before meeting that target .Its daily stochastics remains bullish to overbought. On the downside, its invalidated resistance at the 92.42 level is now expected to reverse roles and provide support and push USDJPY higher again. Other supports below here are seen at the 91.30 level, its Jan 19'09 high and the 89.71 level, its Feb 11'08 low followed by the 88.59 level, its Feb 03'08 low and its double bottom/ YTD low at 87.13.While we believe the pair's current upside is corrective based on its broader medium term decline, breaking and holding above the 94.62 level will hurt its medium term downtrend putting on hold. On the whole, with USDJPY breaking and holding above the 90.00 level, recapture of the 94.62 level is likely to be seen Support Comments 92.42 Feb'09'09 high 91.3 Jan 19'09 high 89.71 Feb 11'08 low Resistance Comments 94.62 Jan'09 high 97.43 Nov 24'08 high 100.55 Nov 04'08 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