Trading strategy: small short at 1.4460, stop at 1.4510 (0.5% risk), 1st objective at 1.4410, 2nd objective at 1.4360

The euro lost ground due to Trichet's statement that the European economic outlook is still uncertain, also adding that Greece fiscal problems won't get any special treatment - intensifying pressure on Greece to cut the continent's biggest budget deficit. Greek bonds extended the decline yesterday after Trichet's comments, which came after the ECB left the interest rate at a record low of 1%. The comments along with the negative data coming from the U.S. - such as December Retails Sales falling, hence leaving 2009 with the biggest yearly drop on record and highlighting the economy problems and the difficulty to recover from the deepest recession in seven decades and the number of newly laid-off workers requesting unemployment benefits, which rose more than expected last week - at 444k Vs. 434k expected. Therefore, bad data from the U.S. combined with bad data from Europe provides a mixed/bearish sentiment of EURUSD, putting the 'breakout above 1.4550′ scenario on hold, for now. Although the euro found bids near the 1.4400 handle in overnight drop, downside pressure remains high, since the euro missed its (good) chance to advance higher - out of flag's upper band. If current decline is to continue, then the more notable support region around 1.4330 may come in focus. Looking on the North side - resistance comes at 1.4475 (former intra-day support), followed by 1.4540/50 and 1.4580/00. Short-term sentiment is still positive but lost strength, while the intra-day charts are bearish. A break above 1.4475 is needed to switch sentiment on intra-day basis. Current exchange rate is 1.4420 @06:55 GMT

Support: 1.4400/20, 1.4330/50, 1.4300 and 1.4250
Resistance: 1.4375, 1.4540/50, 1.4580/00 and 1.4700
Market sentiment: long term - bullish, medium term - slightly bullish, short term - bullish, intra-day - bearish

EURUSD 4hrs chart 1-15-2010


Trading strategy: stand aside

New Zealand dollar's losses against the dollar are smaller, still holding above weekly bottom, hence not triggering the bearish alarm yet. However, intra-day studies show clear signs of weakness and a potential break down below weekly bottom around .7370 could open .7300 for a test later. The whole week hesitation around .7430 cancels optimistic expectations of uptrend continuation, so if it didn't happen on the last days - it's unlikely to occur today, since it is Friday - and Fridays are usually dollar positive, as I said few times before, although I don't have exact stats, so it is just brought out of my memory. Keep an eye on this .7360/70 range while the pair is not trading far from it. Current exchange rate is .7383 @06:55 GMT

Support: .7360, .7300 and .7250/85
Resistance: .7400, .7430/50, .7500 and .7600/30
Market sentiment: long term - bullish, medium term - bullish, short term - bullish, intra-day - bearish

NZDUSD 4hrs chart 1-15-2010

Have a great weekend, folks!