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Daily Technical Strategist

GBPUSD: Weakening With The 1.3504 Level In Focus

Tue, Mar 10 2009, 11:18 GMT
by Mohammed Isah

FXTechstrategy  |  View company's profile

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HIGHLIGHTS:

GBPUSD: Weakening With The 1.3504 Level In Focus - As declines through its Feb 02’09 low at 1.4052 highlighted in our weekly analysis has come to pass and the pair was seen trading to as low as 1.3743 on Monday, threats of further weakness are now expected...

EURGBP: Loss Of Channel Top Highlights The 0.9221 Level- Having maintained a nearer term upside bias since recovering off its Feb 10’09 low at 0.8638,EURGBP cut through its ST symmetrical triangle and its MT declining channel top to close higher on Monday at 0.9145...

GBPUSD: As declines through its Feb 02’09 low at 1.4052 highlighted in our weekly analysis has come to pass and the pair was seen trading to as low as 1.3743 on Monday, threats of further weakness are now expected. With that said, such downside pressures will aim at its key support level residing at the 1.3504 level where an eventual break should resume its longer term downtrend towards the 1.2856 level, its Sept’85 low. Daily and weekly stochastics remain supportive of this scenario. On any recovery higher, its Feb 02’09 low at 1.4052 and the 1.4137 level, its Feb 12’09 low will come in as the next two upside objectives. We envisage these levels to turn back the pair lower but if that fails, we might be in for further upmove towards the 1.4305 level, its Mar 06’09 high followed by the 1.4662 level, representing its Feb 23’09 high. All in all, with the nearer term decline triggered still remaining intact, there is more risk to the downside than upside.

EURGBP: Having maintained a nearer term upside bias since recovering off its Feb 10’09 low at 0.8638,EURGBP cut through its ST symmetrical triangle and its MT declining channel top to close higher on Monday at 0.9145.With this development, risk of further upmove is expected to highlight the 0.9221 level, which marks its .50 Ret(0.9803-0.8638 sell off) with a break and hold above there setting the stage for a run at the 0.9359/89 level, its .618 Ret/triangle pattern price target ahead of the 0.9521 level, its Jan 26’09 high. We envisage a cap at this level turning the cross back down again. Its current upside incursions remain supported by its daily stochastics which is now bullish and trending higher. On any pullback from the present price levels, its Feb 12’09 high seen at 0.9073 will be targeted before its Mar 09’09 low at 0.8951 and then its Mar 05’09 low at 0.8858.Despite this corrective pullback scenario, we expect the 0.9073 level to reverse roles and provide support preserving the pair’s upside gains after breaking the above the mentioned patterns. On the whole, with upside offensives seen through its channel top, additional upside risks are likely.

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Published on  Tue, Mar 10 2009, 11:26 GMT

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