EurUsd Definitely turned out to be a prudent decision to wait and see whether EURUSD's bulls could prevent a re-test of the recently broken downtrend channel around 1.3670. As it turns out, they couldn't, and we have seen the pair slump all the way back to 1.3550. In the process, a bearish engulfing candlestick has been printed on the daily chart which does suggest the bears may have the upper hand today. The next supports to watch on the downside therefore will be 1.3539 (100-day moving average), 1.3510 (50% fibonacci retracement of 1.5145 to 1.1876), 1.3397 (20 Jan low), and 1.3245 (17 Jan low). We still hold a bullish bias over the medium- and long-term so would be looking to reload longs back towards 1.3400-50 area. Key levels to beat on the topside will be today's high 1.3621, 1.3744 (9 Feb high), 1.3861 (2 Feb high), and 1.3896 (61.8% fibonacci retracement of 1.5145 to 1.1876).
GbpUsd The potential GBPUSD descending triangle we highlighted in yesterday's report has struggled to find the hourly close below its base of 1.6020-30 needed to become activated, despite a number of temporary dips lower. Indeed, after one such false break we saw a vicious squeeze higher to 1.6140 levels which looks to have violated the sloped edge of the triangle pattern - a development which doesn't necessarily negate the pattern entirely, but does make us more cautious about its validity. As a reminder, the descending triangle pattern has a target of 1.5780 (measured as the height of the triangle applied to the point of break-out), and supports below are seen at 1.5985 (lower edge of current uptrend), 1.5823 (31 Jan low), 1.5751 (which caught the sell-off after the GDP release), and 1.5718 (13 Jan low). Nevertheless, until that triangle pattern activates we choose to instead obey the reigning 1-month uptrend channel and view dips towards 1.6030 as opportunities to buy. Resistance levels remain sparse on the topside; the nearest one being yesterday's high 1.6140, 1.6185 (7 Feb high), then 1.6300 (4 Nov high), with another long gap until 1.6460 (19 Jan 2010 high) and 1.6515 (7 Dec high).
UsdJpy Yesterday's early break of the 1-month downtrend has led to an emphatic rally higher; smashing through resistance at 83.21 (27 Jan high) and 83.50 (11 Jan high), currently heading for the next resistance level at 83.70 (7 Jan high). Should we manage to break above there then we'll be looking for a re-test of the formidable old range ceiling from early December at 84.40. This =level managed to contain numerous rallies back on 29 Nov, 1 Dec, 2 Dec, 8 Dec, 13 Dec and 16 Dec - so it's likely to be a stubborn barrier on the first test. Next levels beyond come in at 85.40, 85.95 and 86.90. On the downside, first support will be yesterday's 83.21 break-out level, followed by 82.55 (back side of former downtrend), 82.20 (9 Feb low), 81.77 (Tuesday's low) and 81.13 (Friday's low).
UsdChf The 1-2 week uptrend channel is still encouraging USDCHF to power higher, and having cleared the significant hurdle of 0.9687 (not only the 14, 20 & 21 Jan highs, but also the 100-day moving average), we now start to focus on a re-test of 0.9784 (11 Jan high). Above there, we'd be looking to print new 2011 highs, as the following resistance levels have not been touched since late 2010. The first of these is 0.9850 (12-13 Dec highs), 0.9915 (8 Dec high) and 0.9950 (3 Dec high). Good bidders should emerge ahead of 0.9680 (former resistance now turned support), along the lower edge of the uptrend channel (currently 0.9640) and 0.9525 (8 Feb low). Should we slump lower then watch for next levels at 0.9395 (3 Feb lows), 0.9331 (low water mark for this sell-off which was printed on the 2 Feb), and the all-time low of 0.9301.