EUR
Comment: Slightly disappointing that we ended the week at the lower end of its range. For today prices will hopefully base again around the 1.3400 area setting up for a rally back up to 1.3800. The Euro is expected to underperform other European currencies again this week.
Strategy: Attempt longs at 1.3415; stop below 1.3300. Add to longs above 1.3500 for 1.3800.
EUR/JPY
Comment: Dropping as expected and now trading below a very large Ichimoku ‘cloud’, which will probably see it drift to trendline support this week.
Strategy: Attempt shorts at 121.00, but be prepared to add to 124.00; stop above 124.55. First target 119.00, maybe 118.00.
GBP
Comment: Hovering at the top of the formation that has dominated since October and getting little help from other major currencies. It should attempt an important break higher this month, despite a series of formidable resistance levels, with a break above 1.6000 probably setting off considerable short-covering.
Strategy: Buy at 1.5070; stop below 1.4800. Add to longs on a sustained break above 1.5400 for 1.5500 and then December’s high at 1.5725.
JPY
Comment: A fairly impressive reversal candle on the weekly chart against the 9-week moving average and Fibonacci retracement. This suggests we have established this month’s high, maybe the high for Q1 2009. We are now consolidating very neatly at 90.00 and the US dollar is not oversold. Over the week we expect a drop to 89.00, maybe 88.00, where more consolidation is likely.
Strategy: Attempt shorts at 90.10 but only if prepared to add to 91.00; stop above 91.70. First target 89.75/89.55 then 88.00.
