Quote of the day: Accordingly, when the supply of gold runs short, the security behind the notes is diminished, the loaning of notes is restricted or suspended, and the panic follows. - John Buchanan Robinson

EURUSD

Trading strategy: standing aside

Large moves both ways have been seen yesterday as the euro re-tested the bottom into the 1.2150 region and printed a fresh low at 1.2110, then recovered to as high as 1.2353 but still failed to close above the falling trend line coming from 1.3360. Despite the violent recovery, the euro closed the day lower against the dollar and no change in current sentiment is likely. The 1.2100-1.2150 region remains in focus but it might not be easy to breach lower since last 4 attempts were short-lived and the recoveries could have been caused by CBs interventions. However, while holding below the falling trend line, also below 1.2500 - rallies are expected to face selling pressure. Current exchange rate is 1.2219 @07:00 GMT

Support:1.2150, 1.2100/10 and 1.200 Resistance: 1.2275/00, 1.2340, 1.2430/50, 1.2470/00, 1.2550 and 1.2620 Market sentiment: long term - bearish, medium term - bearish, short term - bearish, intra-day - bearish

EURUSD
EURUSD 4hrs chart 6-2-2010

GBPUSD

Trading strategy: small long at 1.4590, stop at 1.4520 (0.5% risk), objective at 1.4730

The rising trend line connecting previous higher lows which I mentioned in my yesterday's report provided a stable support and cable rallied into the 1.47 region - find an interim resistance formed by the 61.8% of 1.5045-1.4230, at 1.4730. Short-term sentiment is in a slightly bullish configuration and last week's top side should become support in order to maintain momentum. Current exchange rate is 1.4721 @07:00 GMT

Support:1.4600, 1.4500 and 1.4400 Resistance: 1.4730/50, 1.4800 and 1.4900 Market sentiment: long term - bearish, medium term - bearish, short term - slightly bullish, intra-day - bullish

GBPUSD
GBPUSD 4hrs chart 6-2-2010

EURGBP

EURGBP
EURGBP daily chart 6-2-2010

Have a good day!