Friday May 12, 2006 - 07:23:28 GMT
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Daily Technicals: .....and the Euro continues to climb
by Marc Spaelti
EURUSD: The bullish move not ended, a piercing spike in European mid-morning brought the pair back on track, overnight the Euro extended its gains to reach 1.2885, 1.2895 is 62% fibo retracement of the 2005 fall, expect this level to last the European session, a spike above that may be seen after US data. Initial support 1.2855, minor at 1.2810, old support line at 1.2780, suggest to buy on dips to around 1.2830ish, a renewed break of it today creates space to 1.2710 or even 1.2660, key support far underneath at 1.2560 today. On top a break of 1.2895 will see a try to trade to the psychological 1.30 level, minor resistance 1.2930 and 1.2965 on the way up.
GBPUSD: Strong UK data stopped Cable weakness, the 1.8510 support was not challenged, instead a 3-cent rally drove the pair to new highs, 1.8885 traded this morning. It remains clearly bullish, initial support 1.8835, trend-line at 1.8790 today, additional strong support at 1.8775 makes this area the key support for the weekly close, if above we will challenge 1.90 next and have a target to top at 1.92 next week. Initial resistance 1.8885, next 1.8945 and expect to develop enough momentum to carry on to 1.90.
USDJPY: The bearish trend held and the pair fell back to the lows, trading on the 109â€™ handle for a first time. There is still more room to the downside with key support lower at 109.20, short-term bearish resistance 110.25, more resistance at 110.45, medium-term resistance 111.00. Initial support 109.90 still strong, but it looks set to break, 109.65 minor support 109.20 key, possible to extend losses to 108.50 max.
USDCHF: The 1.2315 resistance held and it was a very swift sell-off that brought down to a new low of 1.2090 last night, this morning that was extended to 1.2070. Expect good support around 1.2050 to temporarily hold the pair, but risk is to move on to end the week beyond the magic 1.20 handle, 1.1965 first strong support, 1.1810 is next target level. On top watch the 1.2150 level, there is once again lots of space to correct upon breaking this initial resistance, 1.2260 key resistance today, 1.2315 next.
@09.30GMT Swiss KOF Business Climate Index April
@12.30GMT US Trade Balance March
@13.50GMT U. Michigan Sentiment May (prel.)
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