Daily Technical Strategist
- EURUSD: Corrective Downmove Continues To Target The 1.4000 Area
- USDJPY: Looks To Hold Above The 117.19/22 Zone
EUR was seen weakening to as low as 1.4014 in early morning trading today. This is coming on the back of a sell off recorded at the end of Monday trading session, which almost wiped out its Friday upmove.This development now puts the 1.4000 level, which represents its psychological support in focus where a cap is expected but if a break of there occurs, further weakness towards the 1.3930/28 area, its .382 Ret (1.3361-1.4281)/Sept 13'07 high is likely. Below there sits another support at the 1.3839/52 zone, which marks its Aug 06'07/July 24'07 high. The daily RSI and Stochastics are heading lower implying further losses. On the upside, EUR has to push back above the 1.4159/62 zone, its 1.618 Fib Ext (Daily Chart)/Oct 22'95/Sept 25'07 highs followed with a break and close above the 1.4200 area to reduce downside pressure nearer term. The next resistance lies at the 1.4250/81 levels, its 1.272 Ext. (monthly chart)/2007 peak and then the 1.4300 level, its psycho level. On the whole, while the current weakness remains corrective, the pair is expected to push to the upside on completing it.
|1.4000||psychologically important level|
|1.3930/28||.382 Ret (1.3361-1.4279)/Sept 13'07 high|
|1.3839/52||Aug 06'07/July 24'07 high|
|1.4159/62||1.618 Fib Ext (Daily Chart)/Oct 22'95/Sept 25'07 highs|
|1.4250||1.272 Ext. (monthly chart)|
Having resolved to the upside from its symmetrical triangle the past week and closed above the 117.13/22 zone, which represents its Aug 06/10'07 lows/Aug 23'07 high On Monday, USDJPY now looks to challenge higher prices on maintaining above the mentioned key support zone. Upside targets above the 117.13/22 zone are seen at its .618 Ret at 119.36 and its breakout price objective at 121.19.The daily Stochastics remains bullish to oversold. On the downside, initial weakness will target the 116.38 level, its 18 Sept'07 high followed by its breakout point at 115.84 and then the 113.98/114.02 zone, which is the location of its Sept 20 & 25'07 lows. Additional support levels rest at the 112.39 level, its Sept 09'07 low and its year-to-date low at 111.58.All in all, while daily momentum action suggests a nearer term topping process, as long as the weekly RSI and Stochastics remain bullish,short term outlook remains to the upside.
|116.38||18 Sept'07 high|
|113.98/114.02||Sept 20 & 25'07 low|
|112.39||Sept 09'07 low|
|117.13/22||Aug 06/10'07 lows/Aug 23'07 high|
|121.19||Pattern Breakout Price Target|