Daily Technical Analysis

EUR: Possibly attempt tiny shorts at 1.5865/1.5905

Thu, Jul 3 2008, 06:30 GMT
by Nicole Elliott

Mizuho Corporate Bank


EUR

Comment: Squeezing up towards 1.5905, as expected, the highest since late April and close to the highest ever. Consensus opinion is still very much pro-US dollar over the coming 12 months, with a median target at 1.4500 per Euro. For this morning expect another cautious upside squeeze and remember that even if we post a new all-time high this does not necessarily mean that we will continue trading higher for long. A ‘spike’ high or ‘extension’ is a very real possibility. Careful.

Strategy: Possibly attempt tiny shorts at 1.5865/1.5905; stop above 1.6035. Short term target 1.5725/1.5700.


EUR/JPY

Comment: Squeezing a little higher than we had allowed for and likely to move sideways today. Interestingly the Euro is not overbought and bullish momentum is terribly low.

Strategy: Attempt small shorts at 168.35; stop above 169.55. Short term target 167.35, then 166.25.


GBP

Comment: Retreating in order to mount another attack at the psychological level of 2.0000; expect a series of probes above here to a band of resistance up to 2.0050 over the coming week. Bullish momentum should increase if we hold above 1.9800.

Strategy: Attempt longs at 1.9900, adding to 1.9850; stop well below 1.9800. Short term target 2.0000/2.0050, then 2.0500.


JPY

Comment: Jumpy intra-day moves but merely hovering around 106.00. For this morning expect yet more work between 105.50 and 106.50. Yesterday’s squeeze to a high 106.78 is seen as a small ‘spike high’ which should eventually lead to a break below 105.00 which should set off some stops taking prices down to 103.00.

Strategy: Attempt small shorts at 106.15/106.50; stop above 106.85. Short term target 105.50, then 104.25.

Published on  Thu, Jul 3 2008, 06:37 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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