FX Thoughts for the day : 04-Feb-2010 - 1200 GMT


EURO, JAP YEN and EURO-YEN
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Our comments on Dollar-Swiss, Sterling Pound and Australian Dollar are given below
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USD-CHF @ 1.0615/18...Might rise further
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R: 1.0642 / 1.0700-30 / 1.0770
S: 1.0550 / 1.0500-1.0480 / 1.0420

Swiss has risen during the day breaking above 1.06. As mentioned earlier, we might expect a rise towards 1.0700-30 over the next few sessions/days on a break above the immediate Resistance at 1.0642 which is the previous high made on 29-Jan-10. Any sharp move on the downside is not looking likely now and we expect the Support at 1.05 to hold in the US session if any sharp downmove below 1.06 is seen.

Remember 1.0699 is the the 38.2% retracement level of the fall from 1.1965 (09-Mar-09) to 0.9916 (23-Nov-09).

Limit Buy Order:
Buy USD 10K at 1.0530, SL 1.0440, TP 1.0730

GBP-USD @ 1.5820/25...May test 55-week MA today
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R: 1.5922-41 / 1.5976 / 1.6010
S: 1.5765 / 1.5700-5677

The Cable fell further ahead of the BoE. A test of the 55-week MA (1.5754) looks likely today and thereafter there's 38.2% retracement of the rise since Jan '09 at 1.3700 making 1.3700-60 an important Support zone. Hence, a break below this is likely to be very bearish for the pair. Possibly this fall could be as a preparation to any shock that the BoE may announce. A bounce will possibly lead to a test of the Projected Max High at 1.5976

The markets will listen to the BoE comments very attentively.


 
AUD-USD @ 0.8789/93...Might test the previous low of 0.8735
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R: 0.8830-50 / 0.8892 / 0.8960-80
S: 0.8780 / 0.8735 / 0.8670

Aussie is trading in a narrow range of 0.8780-0.8820. Though the Support at 0.8780 is continuing to hold, failure to see a strong upmove above 0.8800 is retaining the downside pressure. We might expect a break below this Support at 0.8780 in the coming session which might pull it down towards the previous low of 0.8735 (23-Dec-09). A further break below 0.8735 might target the 200-DMA (currently at 0.8571) on the downside.

On the upside the 8-DMA (currently at 0.8892) is the significant Resistance seen which we expect to hold if any sharp move above 0.8800 is seen in the US session today.

Happy Trading!