Monday March 31, 2008 - 12:39:18 GMT
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FX Thoughts for the Day - www.fxthoughts.com
FX Thoughts for the day - Evening - 31-Mar-2008....1235 GMT
EURO, JAP YEN and EURO-YEN
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Our comments on Dollar-Swiss, Sterling Pound and Australian Dollar are given below
GBP-USD @ 1.9854/58..â€¦Downside Risk Growing
R: 1.9900 / 1.9940
S: 1.9850 / 1.9798
After the fall to lows of 1.9337 and 1.9361 in the months of Jan-08 and Feb-08 respectively, March-08 saw a reversal, where the pair it a high of 2.0339 before coming off. Importantly none of the moves were sustained, and there was a quick reversal. As a result, the pair currently trades where it started at the beginning of the year. Now in the month of April-08, no new upside or downside (high or low) may be seen and it is likely that a broad range of 1.9330 and 2.0340 would hold. However, the lower end of the range would be vulnerable to a test only if the strong Support at 1.9500 is broken. This can be seen on the 3rd chart at http://www.kshitij.com/graphgallery/gbpcandle.shtml
The pair has had a bad start on the week and it has broken below its important level of 1.9850. See the chart at http://www.kshitij.com/graphgallery/gbpma.shtml . Now should the break sustain, then the pair could fall towards 1.9650-30 later on in the week, with the latter being the statistically projected Max Low for the week.
Immediately today the Support is at 1.9798, the statistically projected Max Low for the day. Below this the Support is at 1.9740. On the upside the Resistance is at 1.9860 and 1.9920. There is a downside risk to the pair if the break below 1.9850 is sustained. Else, on a recovery back above 1.9850, look for a rise towards 2.0150 later in the week.
We entered a Long at 1.9875, which has been stopped out at 1.9835.
USD-CHF @ 0.9951/56....Sell a rally
R: 1.0000 / 1.0050
S: 0.9940 / 0.9900
USD-CHF has fallen in each month of the year so far. But, while in Jan-08 and Feb-08 the pair closed nearly at its lows, this month (so far in March), the pair has bounced back after testing a low of 0.9637 on 17-Mar. Now in the month of Apr-08, the pair is likely to consolidate broadly in a range of 1.0400 and 0.9637, with the latter being the all time low and the former coming on the trendline on the 3-Day charts seen at http://www.kshitij.com/graphgallery/chfcandle.shtml
This week the pair is likely to be bearish initially, and the Resistance of 1.0050 could hold, as seen on the first chart at http://www.kshitij.com/graphgallery/chfcandle.shtml . On the downside the Support is likely at 0.9900.
Today the Resistance is at 1.0000 and 1.0050. On the downside the Support is at 0.9940 and 0.9900. Selling a rally with a small initial stop is suggested. Watching the market with an aim to sell in the 1.0050-1.0100 region.
AUD-USD @0.9114/18...Bearish bias
R: 0.9170-85 / 0.9200 / 0.9227
S: 0.9100 / 0.9050 / 0.9000
It had been feared that a break of 0.9150-40, a support on the trendline joining the lows of 0.8992(24-Mar) and 0.9138(31-Mar) on the 4-hour chart, could bring a further bigger slide in Aussie. Such a break has already been seen in the day and we are now holding a Short.
The Aussie met Resistance near about 0.9184 (13-SMA on the 4-hourly and also the 13-SMA on the daily) and has fallen since and may target 0.9052, the statistically projected Max Low of the day. But, for that, the immediate Support at 0.9100 needs to break. Refer to
The immediate Resistance is at 0.9170-85, 21-SMA and the 13-SMA on the 4-hrly chart. This Resistance could to be tested within the day; however, a break thereof is less likely. The next Resistance above that is at 0.9227, on a trendline joining the highs of 0.9476(13-Mar), 0.9449(16-Mar) and 0.9249(28-Mar) on the 4-hrly chart.
Short 10K @0.9128, SL 0.9184, TP 0.9065 (up from 0.9055 earlier)
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