• Euro exceeds 70 on daily RSI; poised for needed pullback
• Dollar/Yen reverses sharply to almost fully negate Friday's price action
• Cable gains unrelenting as the market approaches 1.6500; RSI above 80
• Dollar/Swiss setbacks stall just shy of 2009 lows

06-01-2009DailyClassPivot

EUR/USD

EUR/USD - Could finally be showing signs of a top with the daily RSI crossing above 70 and the market reaching the 78.6% fib retracement off of the major 1.4720-1.2455 move at 1.4235. A daily close near or below 1.4160 would provide added confirmation and we would look to build shorts at current levels in anticipation of a major pullback. Strategy: SELL @1.4145 FOR A 1.3930 OBJECTIVE, STOP 1.4260.

Level

Resistance

Details

1.4435

R3

12/17 high

1.4365

R2

12/29 high

1.4250

R1

6/1 09 high

Level

Support

Details

1.4100

S1

6/1 low

1.3940

S2

10-Day SMA

1.3925

S3

5/29 low

USD/JPY


USD/JPY - The market has been well offered over the past several weeks but setbacks have now stalled out just shy of next key support by 93.55 from March, which guards against the critical 87.15 multi-year trend lows. Friday's bearish price action has been nearly negated on Monday to suggest that an interim base is in place by 93.85 ahead of fresh upside beyond 97.25. Only back under 94.45 shifts focus back to downside. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

98.30

R3

5/8 low

97.85

R2

5/12 high

97.25

R1

5/28 high

Level

Support

Details

95.55

S1

5/27 high

95.00

S2

5/29 low

94.45

S3

6/1 low

GBP/USD


GBP/USD - We have been looking for opportunities to be short of this pair as well, and have established a fresh short on Monday after gains showed signs of stalling above 1.6400. Shorter-term, hourly studies are overbought and the daily ATR (Average True Range) has already been well exceeded on the day, to make the counter-trend short position very attractive on an intraday basis. Longer-term, the market has now retraced to the 38.2% fib retrace off of the major multi-year high-lows and we would expect to see some form of capitulation at current levels in light of the major retracement level. Finally, the daily RSI has broken above the 80 level which is now severely overbought and warning of a much needed and healthy corrective pullback. We have left our objective open and will be looking for an RSI move back towards 70 (currently 81) over the coming days. Position: SHORT @1.6407 FOR AN OPEN OBJECTIVE, STOP @1.6687.

Level

Resistance

Details

1.6675

R3

10/30 high

1.6600

R2

Figure

1.6500

R1

Psychological

Level

Support

Details

1.6300

S1

Figure

1.6200

S2

5/29 high

1.6160

S3

6/1 low

USD/CHF

USD/CHF - After finally trading down to 30 on the daily RSI, the market could be looking for a much needed and healthy corrective rally. Setbacks on Monday stalled out just shy of the 2009 lows by 1.0610 and the market has since recovered back to daily opening levels by 1.0670 to potentially set up a doji close. Look for a break back above 1.0725 to accelerate gains and confirm short-term basing, while below 1.0610 opens deeper setbacks towards next key support by 1.0370, the late December lows. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

1.0860

R3

5/29 high

1.0805

R2

5/28 low

1.0725

R1

6/1 high

Level

Support

Details

1.0620

S1

6/1 low

1.0610

S2

1/2 09 low

1.0485

S3

12/30 low


Written by Joel Kruger, Technical Currency Strategist for DailyFX.com. If you wish to receive Joel's reports in a more timely fashion, e-mail
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