EurUsd After an unsuccessful attempt on the 1.3861 (2 Feb resistance level) yesterday, EURUSD had a rather subdued afternoon that has now led us back to lows of 1.3744 this morning. Overall however, our outlook has changed very little on this pair. 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). 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 1.3744 (today's low), 1.3705 (24 Feb low which caught the sell-off on Monday), 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 At last, GBPUSD managed to break above 1.6299 resistance yesterday -a resistance level that blocked numerous rallies ever since it was first defined on 4 Nov last year. The subsequent follow-through however has been disappointing, with the pair only getting as far as 1.6329 before slumping back towards the lower end of 1.6200. We remain resolutely bullish over the medium-term, but in the short-term we are realistic that it could be a rocky ride -especially considering the shooting star candlestick printed on the daily chart yesterday which suggests a correction is coming. If we do manage to overcome 1.6299 once more (a scenario made all the more possible by yesterday's achievement) 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 now eyed at 1.6216 (today's lows), 1.6110 (lower edge of 2-month uptrend), 1.6070 (17 Feb low), 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 Rather choppy, directionless trading in USDJPY yesterday, but we still believe that a short-term correction higher is on the cards. The reason for this mild bullish bias is that a double bottom pattern became activated on the hourly chart yesterday (by a break above the neckline 82.05), and the target stands at 82.50 (measured as the depth of the 2 lows from the neckline, added to the point of break out). The slump back below the neckline today is a little disappointing, but we feel it's safe to now set a stop around yesterday's sell-off low 81.80, and continue to look for resumption of the buying pressure until 82.50 is met. The only resistance levels ahead of our target is yesterday's high 82.24, but beyond 82.50 we also note 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 81.80, then 81.62 (24 & 28 Feb lows), 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 Very low volatility witnessed in USDCHF of late, with the pair barely covering more than a 60 pip range all week. As discussed yesterday 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 0.9320 (25 Feb & 1 Mar ceiling), 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. Only resistance levels of note are 0.9260 (Monday'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.