DJ European Forex Technicals

Mon Aug 02 02:24:00 EDT 2010

EUR/USD Bulls To Meet 1.3125

By Francis Bray
A DOW JONES NEWSWIRES COLUMN

LONDON (Dow Jones)--Rolling 24-hour chart levels:

Forex spot: EUR/USD USD/JPY GBP/USD USD/CHF

Spot 0512 GMT 1.3084 86.53 1.5720 1.0400

3 Day Trend Bullish Bearish Bullish Bearish
Weekly Trend Bullish Bearish Bullish Bearish
200 day ma 1.3273 90.95 1.5383 1.0783
3rd Resistance 1.3145 87.19 1.5861 1.0500
2nd Resistance 1.3125 87.00 1.5814 1.0467
1st Resistance 1.3107 86.73 1.5790 1.0438
Pivot* 1.3042 86.47 1.5655 1.0414
1st Support 1.3054 86.43 1.5679 1.0362
2nd Support 1.3027 86.20 1.5615 1.0300
3rd Support 1.2980 85.95 1.5552 1.0231

Intraday EUR/USD: Having spent Friday's session consolidating beneath last week's 1.3107
high, bull pressure is building on 1.3107 to threaten further strength to the 1.3120/25 target area.
This area incorporates the 38.2% retracement level of the 1.5145/1.1876 decline and the
measured objective of an inverse head-and-shoulders base pattern, and protects the 1.618
extension target at 1.3145. Failure to break above 1.3107 would prompt lateral consolidation
back to the range low at 1.2980.
Weekly chart EUR/USD trend: Bullish.

Intraday USD/JPY: Despite Friday's recovery off 85.95, last week's lowest close for 15 years
highlights the dominant trend, and the 85.85/95 support area is likely to come under renewed
pressure. 85.85 represents a downwave equality target projected off the June 4 bear pennant
lower high at 92.89, but a deeper target at 85.24 is also achievable, which is close to the
November 2009 bear wedge low at 84.82. Above 86.73 would provide respite, but the 87.00
level should cap corrective gains.
Weekly chart USD/JPY trend: Bearish.

Intraday GBP/USD: Extends the dominant short-term uptrend having set fresh five-month highs
above 1.5700 Friday, and is looking to stretch to meet upside targets just beneath 1.5790. This
resistance level will look to protect the Feb. 17 lower high at 1.5814, but for now, there is little
evidence that the uptrend is close to a peak. A break below Friday's bullish outside day low at
1.5552 is required to damage the uptrend, but this is protected by support at 1.5615.
Weekly chart GBP/USD trend: Bullish.

Intraday USD/CHF: Bear pressure is building on Friday's six-month low at 1.0362 following the
setback off 1.0467, and the dominant bear trend is set to extend towards 1.0300 and 1.0231.
Keeping 1.0362 intact would suggest lateral consolidation of the sharp downwave off the July 27
lower high at 1.0640 is required back towards 1.0467 before resuming the downtrend.
Weekly chart USD/CHF trend: Bearish.
Forex spot: EUR/GBP EUR/JPY EUR/CHF AUD/USD

Spot 0536 GMT 0.8316 113.29 1.3606 0.9105

3 Day Trend Bearish Bearish Bearish Bullish
Weekly Trend Bearish Bullish Bearish Bullish
200 day ma 0.8626 120.76 1.4285 0.8767
3rd Resistance 0.8415 114.24 1.3700 0.9271
2nd Resistance 0.8393 114.07 1.3669 0.9193
1st Resistance 0.8363 113.40 1.3634 0.9108
Pivot* 0.8331 112.85 1.3578 0.9027
1st Support 0.8303 112.59 1.3573 0.9023
2nd Support 0.8250 112.03 1.3510 0.8967
3rd Support 0.8202 111.60 1.3484 0.8909

Intraday EUR/GBP: Continues to edge lower as Friday's low at 0.8303 is set for renewed
pressure. A break below there would extend the setback off the July 27 lower high at 0.8415,
exposing 0.8250 but creating scope for an equality downwave target at 0.8202. Regaining ground
above 0.8393 is required to question the bearish outlook, opening the 0.8415 lower high.
Weekly chart EUR/GBP trend: Bearish.

Intraday EUR/JPY: The corrective recovery off Friday's low at 112.03 is extending Monday to
challenge resistance at 113.40. However, upside scope looks limited to the 114.07 area, as the
previous week's bearish reversal candle dominates the near-term. A break below 112.59 would
re-expose the 112.03 low, and prompt a deeper setback towards 111.60 and key projected
support at 111.36.
Weekly chart EUR/JPY trend: Bullish.

Intraday EUR/CHF: The recovery off Friday's low at 1.3510 is looking to regain a foothold
above 1.3600 and test resistance at 1.3634. However, with last week's bearish reversal candle
dominating the tone, the upside threat looks limited to the 1.3700 area. A sustained break below
1.3573 is required to bring the focus back onto the 1.3510 low, and key projected support at
1.3484.
Weekly chart EUR/CHF trend: Bearish.
Intraday AUD/USD: Pushes into fresh twelve-week highs to extend the strong rally off 0.8909 as
the upside target at 0.9108 is effectively reached. Concerted strength has scope for a higher
upside target at 0.9193, as bull momentum continues to power higher. Corrective weakness will
attract support while above 0.8967, which is protected by 0.9023.
Weekly chart AUD/USD trend: Bullish.

Disclaimer
(This article is general financial information, not personalized investment advice, as it does not
consider the unique circumstances affecting an individual reader's decision to buy or sell a
specific security. Dow Jones does not warrant the accuracy, completeness or timeliness of the
information in this article, and any errors will not be made the basis for any claim against Dow
Jones. The author does not invest in the instruments or markets cited in this article.)