Eurusd slowly trended lower yesterday and this morning as the Dollar continues to defy bad numbers and broke previous 1.3290 support to trade as low as 1.3222 this morning. Initial resistance stands at 1.3350 (23.60% retracement of the post NFP move that took us from 1.3750 to 1.3300 in a little more than 2 trading days). Potential dollar weakness as Obama steps into office could see a return to 1.4410 where last December 18 culmination failed, but short term we should look at 1.3500 being the top of our current channel. On the downside, previous 1.3400 has given way to 1.3265, then 1.3000 if current trend continues.
GbpUsd Market reversed most of Cable gains from mid-December down to 1.4360 before rising again to 1.5375. Cable continues to extend losses from yesterday, sharp decline testing early Jan lows. On the downside, strong support holds at 1.4563 – Jan levels. Further support holds 1.4376 31st December low. Sentiment remains mixed to negative but renewed strength may open the way to 1.5348(Jan 9th high) on the long term 1.6006 (50% retracement of 1.7650 – 1.4363 decline).
UsdJpy UsdJpy broke out the 4-month downtrend upper trendline and hit 94.64 high on Tuesday of last week. Initial resistance holds 94.59 (6th Jan high). On the upside, strong resistance holds 100 pivot point, but only a recovery over 103 upper trendline and 105 pivot point will put focus again on 108 and 110.67 15th August high. Near term support can be seen at 88.46 as current trend is in line with mid December retracement – 87.14 December 17th low.
UsdChf Market traded as high as 1.1242 yesterday as the dollar extends gains and recovers Jan 8th low of 1.0865. Uptrend may open the way through 1.1244 yesterdays high – that we tested again this morning and also coincides with 50% retracement from 1.2085 – 1.0405 move. Renewed weakness may break down 1.0735 and return toward 1.0500 and 1.0375. Such a move may look for 1.0013 15th July low in front of 0.9637 17th March low.