Friday August 18, 2006 - 07:05:17 GMT
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Daily Technicals: Currency rally stopped
by Marc Spaelti
EURUSD: After a strong start to reach a new high of 1.2885, the mood turned, short-term bullish trend-line was broken at 1.2850a dn the pair fell to 1.2815. This is the 38% retracement of this weeks rise and first strong support. Initial resistance at 1.2845 this morning, more resistance at 1.2865 and key at 1.2885/1.2900, a weekly close above this is bullish, while underneath the pair can trade sideways in a 1.27/1.29 range for a while longer. A fall through 1.2815 should yield 1.2775, lots of good support levels ahead of the 1.2670 key should keep the pair from falling.
GBPUSD: Again Cable temporarily traded above 1.90, again it was sold, this time the medium-term rising trend was broken, a sharp sell-off to 1.8820 followed, from where it returned to 1.8860 overnight. Minot support at 1.8850, stronger 1.8820 and more at 1.8765, the 38% retracement level of the last 4-weeks rise. Initial resistance at 1.8885, 1.8905 is pivot, a daily close above that leaves the pair bullish to try the upside again next week, alternative is to trade a range of 1.8650/1.8950 next week.
USDJPY: The low was stretched to 115.15 before the Dollar turned and headed the other way to rally to 116.20 before it settled around 116.00. Strong resistance right there at 116.05, strong support 115.50, slight bias to the upside with space to climb to medium-term resistance at 116.60, a level I like to establish fresh short positions. To the downside a weekly close underneath of 115.50 is bearish, key support unchanged at 114.65.
USDCHF: The 1.2260 key level was bypassed intra-day only, in European afternoon the Dollar turned to rally back to a 1.2350 high. Failure to break the 1.2260 key support this week is bullish Dollar. For the coming week, we expect to continue holding narrow ranges of 1.2250/1.2450, with the risk to test key resistance at 1.2570. Today strong support 1.2290, key 1.2260, more at 1.2240. Minor resistance 1.2325, stronger 1.2360, bypassing that leaves space to end the week near 1.2435.
@09:00GMT Euroland Trade Balance June
@13:50GMT US U. Michigan Consumer Sentiment August (prel.)
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