EurUsd It didn't feel like a very directional day's trading yesterday, but even so we have seen EURUSD nudge to new highs of 1.3856; a mere 5 pips shy of the next key resistance level of 1.3861 (2 Feb high). With the 2-week uptrend channel still going strong there's good reason to believe that we can challenge that 1.3861 level once again today, and potentially go on to the other nearby resistance 1.3896 (61.8% fibonacci retracement of 1.5145 to 1.1876). Overall we remain confident in our medium term view that EURUSD has the support for an eventual challenge on the psychologically important 1.4000 level. First support is 1.3705 (24 Feb low which caught the sell-off yesterday), 1.3635 (last seen late on 22 Feb), 1.3528 (22 Feb low) and 1.3460 (15 & 16 Feb low). Indeed, we still feel that 1.3460 would be a decent area to add to longs, but would start to reconsider our bullish bias on a test of the neighbouring supports at 1.3428 (14 Feb low) and 1.3397 (20 Jan low).
GbpUsd Loyalty to GBPUSD's 2-month uptrend channel has been rewarded this week, as the pair has recovered strongly off its 1.6032 lows seen Friday and squeezed all the way higher to 1.6299 in Asian trading. That price is identical to the high seen on 4 Nov; a resistance level that has been the major glass ceiling to GBPUSD rallies in the past few months. Given this history, it would not be surprising to see us pare back off the highs yet again today; but we are encouraged that the market is continuing to push the agenda of a move higher, and like our chances of tackling this level once and for all in the coming week. If we do manage to overcome 1.6299 then the route is cleared for a run at 1.6460 (19 Jan 2010 high) and 1.6515 (7 Dec high) -a very exciting prospect indeed for us bulls. Near term support is still eyed around 1.6070-75 (17 Feb low and lower edge of 2-month uptrend), with further levels around 1.6031 (Friday's low) and 1.6000. Only a break of that 1.6000 level would force us to reconsider our bullish bias from here.
UsdJpy Interesting developments in USDJPY today as the easing of risk aversion has allowed the pair off the 81.62 lows. There have now been two separate tests of the 81.62 support level -the first back on 24 Feb, and the second just yesterday; meaning we are now potentially looking at a very small but clearly visible double bottom pattern on the hourly chart. The pattern looks to have already been activated by the break above its neckline 82.05 (roughly the 25 Feb high), so we now look for the squeeze higher to target 82.50 (measured as the depth of the 2 lows from the neckline, added to the point of break out). Given such a short distance to our target, there are no resistance levels in between to hinder progress; but should we overshoot that 82.50 mark then next resistance lies at 82.85-90 (23 Feb rebound highs), 83.55 (18 & 21 Feb highs), and 84.00 (roughly the 16 Feb high). On the downside there are multiple technical support littering the downside; the first is now 82.05 (our pattern neckline where those who missed the initial break out might try their hand at buying dips), 81.13 (4 Feb low), 80.94 (31 Dec and 2 Jan lows), 80.54 (9 Nov low), 80.24 (31 Oct low) and then the all-time low of 79.75 from 1995.
UsdChf Like USDJPY, USDCHF has been pulled off its lows by the easing of risk aversion in the markets, and just this morning the pair has looked to challenge the 0.9320 resistance last seen on 25 Feb. We also note that the pair has broken above a 2-3 week downtrend channel around 0.9315 -but it's worth noting that this proposed channel has only been touched on a couple of occasions so carries pretty low predictive value in our minds. On the topside, sellers will probably start to precipitate around 0.9390 (23 Feb high), 0.9505 (22 Feb high), 0.9540 (18 Feb high), and 0.9600 (17 Feb high). We are still hanging onto short positions for now, but would be forced to concede defeat if we get another push above 0.9320 later today. Only resistance levels of note are 0.9260 (yesterday's low), 0.9234 (all-time low seen 24 Feb) before we once again are reliant on mere psychological levels at 0.9100, 0.9200 and 0.9000.