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Daily Technical Analysis

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EUR: Buy at 1.3515; stop below 1.3300

Wed, Jan 7 2009, 07:23 GMT
by Nicole Elliott

Mizuho Corporate Bank


EUR

Comment: Dropping more than expected, giving back almost 61% of December’s rally, with a ‘spike low’ roughly in the middle of a very large weekly Ichimoku ‘cloud’. The move is seen as an A, B, C-type correction and we continue to watch for signs that the Euro will base around current levels.

Strategy: Buy at 1.3515; stop below 1.3300. Add to longs above 1.3660 and again above 1.3850 for 1.4000.


EUR/JPY

Comment: Dead in the water. This Yen cross is crawling sideways in the middle of a very large Ichimoku ‘cloud’ and below first retracement resistance. This may cap again today suggesting a drift down to the 26-day average at 123.45.

Strategy: Possibly attempt shorts at 126.65; stop above 129.00. First target 125.25, then 123.45.


GBP

Comment: Exciting that we have pushed up to the top of the downward-sloping ‘wedge’ formation, but problems on the way up are myriad and the Ichimoku ‘cloud’ is massive. One step at a time.

Strategy: Buy at 1.4900; stop below 1.4700. First target 1.5000/1.5035, adding to longs on a sustained break above 1.5050 for 1.5400.


JPY

Comment: Pushing higher for a third day in a row, retracing over 50% of prior declines, with a small ‘spike high’ yesterday. We shall continue to watch for signs of stalling at or just ahead of the 95.00 area and the Ichimoku ‘cloud’. This is seen as a selling opportunity for declines later this quarter.

Strategy: Attempt small shorts at 93.65; stop well above 94.65. First target 93.25, then 92.25.

Published on  Wed, Jan 7 2009, 07:27 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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