Euro fails to hold gains after breaking channel top. Dollar/Yen remains well bid and eyes push back to 100.00. Cable reverses sharply after failing ahead of 1.5000. Dollar/Swiss still holding above 200-Day SMA on close basis.

04-30-09_classical_1

EUR/USD

EUR/USD - The break above falling channel support off of the 1.3740 highs is concerning for bears but the market has failed to show any good follow through thus far. After breaking out on Wednesday, gains extended to 1.3385 today before pulling back sharply into the 1.3200's. This sets up the potential for a false upside break and could once again put pressure on the downside. We recommend taking to the sidelines at current levels, with a break back above 1.3385 or below 1.3120 required for clearer directional bias. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

1.3515

R3

4/2 high

1.3385

R2

4/30 high

1.3340

R1

4/29 high

Level

Support

Details

1.3190

S1

4/30 low

1.3120

S2

4/29 low

1.3000

S3

4/27 low

USD/JPY

USD/JPY - The pair has been very well supported on dips to the Ichimoku cloud with the market finally reversing course on Wednesday to break back above Tuesday's 96.80 highs. This ends a sequence of 7 consecutive daily lower highs and likely signals fresh upside over the coming days back towards the 99.00-100.00 area. Only back below 95.60 gives reason for pause. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

100.00

R3

Psychological

99.75

R2

4/17 high

99.40

R1

4/20 high

Level

Support

Details

97.95

S1

4/29 high

97.15

S2

4/30 low

96.75

S3

4/28 high

GBP/USD

GBP/USD - No reason to be taking positions at current levels with the market caught in the middle of a very choppy range. Our bias however is for an eventual resumption of the broader downtrend to be confirmed on a break back below 1.4395 which should then open a fresh downside extension exposing next key support by 1.4110 (30Mar low). Any rallies should be well capped ahead of 1.5000 with only a sustained break back above 1.5070 required to shift outlook. A close at or near Wednesday's closing levels by 1.4770 sets up a bearish doji formation. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

1.4950

R3

4/30 high

1.4900

R2

Figure

1.4840

R1

4/16 low

Level

Support

Details

1.4690

S1

4/28 high

1.4610

S2

4/29 low

1.4515

S3

4/27 low

USD/CHF

USD/CHF - The 200-Day SMA is the key here with the market remaining quite constructive while the pair holds above the longer-term moving average on a close basis. Recent attempts below the moving average have failed and we are once again bouncing to suggest fresh upside ahead. Look for a break back above 1.1445 to take pressure off of the downside and accelerate gains back towards 1.1600. Strategy: SIDELINED; AWAIT CLEARER SIGNAL.

Level

Resistance

Details

1.1525

R3

4/24 high

1.1500

R2

4/29 high

1.1445

R1

4/29 high

Level

Support

Details

1.1360

S1

200-Day SMA

1.1300

S2

4/29 low

1.1270

S3

4/30 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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Tech Talk - A Daily Video Highlighting Technical Developments in the Overnight Session of Trade.
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Daily Classical - A Daily Technical Overview of the Major Currencies.
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