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FX Thoughts for the Day

Fri, Oct 10 2008, 13:43 GMT
by Kshitij Consultancy Service Team

Kshitij Consultancy Service

EURO, JAP YEN and EURO-YEN
---------------------------
Read our current comments and trade recommendations on EUR-USD, USD-JPY and EUR-JPY by registering at
http://www.kshitij.com/fxthoughts/fxthoughts.shtml#register

Our comments on Dollar-Swiss, Sterling Pound and Australian Dollar are given below
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USD-CHF @ 1.1178/83...Can target 1.10-09
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R: 1.1250 / 1.1315-25
S: 1.1145-15 / 1.0900
It is a question that needs to be asked - if Swiss Franc was also a "carry trade" currency (alongwith the Yen), why has the Swiss Franc not strengthened alongwith the Yen, instead of weakening alongwith the Euro? For now, it looks like it may be in a large sideways range of 1.09-1.15, with potential to fall towards 1.10-09, while it trades below 1.13. In the bigger picture, the trendline Resistance near 1.15 on the Monthly chart has held. Hence a fall towards 1.10-09 looks possible. Take a look at
http://www.kshitij.com/graphgallery/chfmth.shtml

On the other hand, note that the market has bounced from 1.1128, which is near the projected Max Low of the day near 1.1142. As such, selling near 1.1220 may be considered, with a Stop above 1.1350, targeting 1.10 and 1.09.
 
 GBP-USD @ 1.7075/79... Potential bull hammer
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R: 1.7100 / 1.7150 / 1.7200-20 / 1.7270-7300
S: 1.7000 / 1.6935 / 1.6850 / 1.6779 / 1.6700
The pair has seen a sharp bounce in the day after the low of 1.6779 was seen. Since then the pair has almost recovered all the losses for the day.

Provided Cable continues to rise from here beyond 1.71 and closes above the same, the pair could turn potentially bullish and could see a further rally towards 1.75-77.

The high volatility keeps us out of the market for now. However, traders should keep an eye on the potential bull hammer visible at: http://www.kshitij.com/graphgallery/gbpcandle.shtml

A failure to rise past 1.71 would once again lead to a slip towards 1.6779-6550.

 
 AUD-USD @ 0.6619/23...Fresh fall possible
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R: 0.6780 / 0.6820 / 0.6887
S: 0.6590 / 0.6535 / 0.6445
Like the Euro-Yen, the AUD-USD has seen a huge fall since the Jul-08 high of 0.9850. One can see a Bear Flag in the Aussie as well. Please click on
http://www.kshitij.com/graphgallery/audma.shtml

Question is, could the downmove be coming to an end? Cannot say that. While the market trades below 0.6780, a fresh dip towards 0.64 cannot be ruled out over time. Further, it is to be noted that the market is currently trading near the projected low of the day, which is at 0.6590

Happy Trading!
 

Published on  Fri, Oct 10 2008, 13:45 GMT