Tuesday May 16, 2006 - 07:10:11 GMT
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Daily Technicals: A mixed bag: Euro bear, Cable bull
by Marc Spaelti
EURUSD: 1.2895 was broken early on and never seen again, by the end of the day the 5-week support was broken and a low of 1.2780 traded tonight. Strong resistance at 1.2845, minor 1.2815, while underneath expect this correction to deepen, 1.2760 is the next strong support, 1.27210 minor, key support at 1.2655. A move back to the top seems unlikely, bypassing 1.2845 may lead to 1.2895 intra-day, only a daily closure above this is bullish.
GBPUSD: 1.8885 broken, a correction set in that has taken the pair almost back to its 3-week trend-line, this rising support has reached 1.8755 this morning and will be the key support to watch today. Additional strong support at 1.8710, but a daily close underneath of the 1.8755 trend-line will signify further correction in the days to come, targeting 1.8510. For now the trend remains in place, initial strong resistance at 1.8825 and 1.8865, a daily close above 1.8885 keeps cable well bullish.
USDJPY: Correction has set in and drove the pair to a high of 110.85 overnight. A dip back under 110 this morning keeps the pair bearish, initial resistance at 110.20, stronger at 110.65, while underneath, expect to again try for 109.20 and maybe overshoot this target a bit. A break of 110.65 however consolidates the pair in a 110/112 range, a rise to key resistance at 111.50 should follow quickly.
USDCHF: The 1.2060 resistance area was bypassed early in Europe and has since become the initial support, while above, risk is to ascend towards 1.2260 key area, initial resistance at 1.2135 strong and 1.2200 minor, medium-term bearish resistance is much higher at 1.2380. A return underneath of 1.2060 can see the pair dip to 1.2020, a lower daily close is bearish for new lows, but risk for that seems fairly limited from here.
@08:30GMT UK CPI April
@09:00GMT German ZEW May
@12:30GMT US PPI April, Housing Starts April
@13:15GMT US Capacity Utilization, Industrial Production April
@17:00GMT US Housing Market Index May
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