Daily Technical Analysis

EUR: Attempt longs at 1.5390/1.5360

Mon, May 12 2008, 07:19 GMT
by Nicole Elliott

Mizuho Corporate Bank


EUR

Comment: A ‘doji’ candle on Thursday and on the weekly chart suggests we have found an interim low and will consolidate above here for several days. For this morning prices should hold above 1.5350 with a sustained break above 1.5450, while a break above 1.5500 should set off a short squeeze to 1.5555/1.5600.

Strategy: Attempt longs at 1.5390/1.5360; stop below 1.5270. Short term target 1.5475, then 1.5550.


EUR/JPY

Comment: More signs of topping with a third black weekly candle. This week should see repeated testing of the bottom of the weekly cloud at 159.15 and the 9-week moving average at 158.34.

Strategy: Sell at 159.15 but only if prepared to add to 160.40; stop above 161.15. Short term target 159.00 then 158.35, probably 156.00 by the end of the month.


GBP

Comment: Probing the bottom of the downward-sloping ‘wedge’ formation and some of the lowest levels this year. Wait and watch for a reversal pattern this week.

Strategy: Attempt longs at 1.9465; stop well below 1.9400. Short term target 1.9550 then 1.9665.


JPY

Comment: A ‘bearish engulfing’ candle on the weekly chart against the 50% Fibonacci resistance suggests we are building an interim top. Expect more work this week below 105.50, with support between 102.00 and 101.50 possibly limiting the downside. Longer term we expect more price declines.

Strategy: Attempt shorts at 103.50 but only if prepared to add to 104.50; stop above 105.00. Short term target 103.00/102.75, eventually 101.50.

Published on  Mon, May 12 2008, 07:28 GMT

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Mizuho Corporate Bank  | 1-3-3, Marunouchi, Chiyoda-ku, Tokyo 100-8210
http://www.mizuho-cb.co.uk | Nicole.Elliot@mhcb.co.uk

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