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Daily Recommended Trades

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Daily technical outlook

Wed, Oct 28 2009, 07:01 GMT
by Liviu Flesar

InnerFX

EURUSD

Euro’s sell-off continued on yesterday as a result of equities pulling back from recent top sides. Support has been found on the 50% retracement of October’s swing from 1.4480 to 1.5060 – at 1.4770 and former support zone around 1.4830 provides a minor resistance which is under pressure at the time of writing this. Short-term sentiment is slightly bearish but I wouldn’t jump to conclusions that this is trend reversal, therefore no need to panic on a common 300 points retracement – which is actually an average weekly range. However, keep an eye on the 1.4770 and 1.4700 support levels because an extended decline into the 1.46 region would hurt the mid-term’s sentiment and the euro could become vulnerable to reaching 1.45. On the North side, upside will become favored if the euro will regain the resistance into the 1.4830-1.4850 region, thus a hourly bar close above the 1.4850 is needed to provide the first bullish confirmation on a potential recovery to 1.5. I’m tempted to buy but I rather wait until the euro will eventually regain the upper side of 1.48. Current quote is 1.4838 @07:00 GMT

Support: 1.4770, 1.4700 and 1.4650
Resistance: 1.4830/50, 1.4880/00 and 1.4925/50

GBPUSD

Cable’s consolidation continues below the 1.6400 mark which provides the first intra-day resistance. Above 1.6400, a more notable barrier is emerging at 1.6500. On the lower side, support starts around 1.6300 backed by 1.6200 and 1.6080. Short term sentiment remains positive despite Friday’s sell-off and an uptrend resumption requires the clearance of 1.6500 on first phase. Intra-day charts are telling "Caution: Wet floor” since a fragile support is being formed by a rising trend-line as seen on the chart below. Price action doesn’t show any efforts to regain recent losses therefore a drop below that minor trend-line could intensify selling towards the 1.6200 and 1.6080 fib ratios. Current quote is 1.6375 @07:00 GMT

Support: 1.6300, 1.6200 and 1.6080/00
Resistance: 1.6400, 1.6500 and 1.6600

USDJPY

A rising trend line formed on the daily charts, as seen below, is under pressure around 91.00. If it holds, a resume would aim towards 92.00-92.50 which won’t be easy to break. Short term sentiment is still bullish but the intraday momentum is bearish as the yen rallied throughout today’s Asian session. Selling dollar’s rallies seem to be the plan for now. Current quote is 91.33 @07:00 GMT

Support: 91.00, 90.50 and 90.00
Resistance: 91.50, 92.00/20, 92.50 and 92.90/00

Published on  Wed, Oct 28 2009, 07:05 GMT