DAILY FORECAST FOR EURUSD 10th August 2009

Bias: While 1.4217-37 caps I still feel there should be further losses below 1.4153

Daily Bullish:

The failure at 1.4445 did not come as a surprise but the drop below 1.4225 has tended to argue against direct follow-through higher. There is immediate resistance at 1.4217-37 which I feel will cap today. Thus, any bullish stance will require a break above 1.4240 and if seen would suggest a return above 1.4280 and to the 1.4330-40 pivot resistance at least. Take care there. Breach would suggest a return to the 1.4445 high...

MT Bullish:

10th August: Failure at 1.4445 argues against direct gains at this time and we'd need a break above 1.4237 and 1.4330-80 to begin to think of reviving this. Even then we'd have to be careful of the risk of sideways consolidation below 1.4408.

Daily Bearish:

The drop below 1.4225 does seem to open up a return to June's low at 1.3747. There are some complications but for the moment I feel that while 1.4217-37 caps we should see additional losses. From this resistance a push back down to Friday's 1.4153 low should be seen at a minimum and to 1.4110-20 at least. If this is going to turn into a more aggressive move then this must break and should then generate sufficient bearish momentum to see a move all the way down to 1.3985-93.

MT Bearish:

10th August: As long at 1.4217-37 caps there is still a good risk that we should see losses through 1.4153 for 1.3985-93 initially and eventually the 1.3747 low. However, with uncertain positions elsewhere we will need to monitor this at all stages.

For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for potential trading levels highlighted in the report are now available on the Daily Forecast page of my web site.