EURUSD: Reinforces Strength Towards Its 2007 Peak

EURUSD- Although an attempt to follow through to the upside on its Monday gains failed yesterday above the 1.4900 levels, EUR continues to maintain its medium term bullish structure suggesting that any failure at the present levels is likely to be temporary. While the key support at the 1.4751/52 zone, its Nov 09’07/Dec 11’07 remains unbroken, risk are for a fresh upside attack on the 1.4967 level, its 2007 peak to occur with a clean penetration of there paving the way for a move towards its psycho level at 1.5000 and next the 1.5155 level, its 1.618 Fib Ext.The weekly momentum indicators are positive suggesting further upside incursions. On the downside, an invalidation of the 1.4823 level, representing its Jan 04’08 high followed with a loss of the 1.4751/52 zone, its Nov 09’07/Dec 11’07 will halt its current strength and bring even lower prices towards its Jan 01’08 low at 1.4577 ahead of the 1.4310 level, which is the location of its Dec 20’07 low. A clear sign that this is going to occur is not yet seen. Overall, EUR looks to head towards its 2007 peak at 1.4967 and ultimately break through there triggering the resumption of its medium term uptrend on hold since Nov 23’07.

Support Comments

1.4823 Jan 04’08 high

1.4751/52 Nov 09’07/Dec 11’07 Highs

1.4577 Jan 01’08 low

1.4310 Dec 20’07 low

Resistance Comments

1.4967 2007 Peak

1.5000 Psycho Level

1.5155 1.618 Fib Ext.

GBPUSD: Downside Weakness Wanes Nearer Term

GBPUSD-While nearer term corrective upmove has started building up which saw the pair head as high as 1.9740 intra-day on Tuesday, a failure by the pair to maintain most of those gains suggest another attempt on the downside may be seen. In such a situation, the 1.9498/81 area, its weekly 100 ema/Jan 11’08 low comes in as the next downside target followed by its .618 Ret (1.8091-2.1160 rally) at 1.9271 ahead of its Mar 05’07 low at 1.9183.The weekly and monthly studies remain supportive of this view. On the other hand, if the mentioned recovery started yesterday continues to strenghthen, then a run to the upside towards the 1.9653/23 area, its Aug 17’07 high/.50 Ret (1.8091-2.1160 rally)/Jun 08’07 with a loss of there setting the stage for further recovery aiming at the 1.9753 level, its Dec 24’07 low and then the 1.9879 area, its Sept 18’07 low. A turn above there will expose its psycho resistance at 1.2000.On the whole, while the medium term downtrend remains intact, nearer term corrective recovery could be seen as evidenced by its oversold daily stochastics.

Support Comments

1.9498/81 Weekly 100 Ema/Jan 11’08 low

1.9271 .618 Ret

1.9183 Mar 05’07 low

1.9023 May’2006 high

Resistance Comments

1.9653/23 Aug 17’07 high/.50 Ret (1.8091-2.1160 rally)/Jun 08’07

1.9879 Sept 18’07 low

1.2000 Psycho Level

1.2094 Daily 200 ema

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