HIGHLIGHTS:

EURUSD: Bounces Off The 1.2765 Level- EUR closed higher Monday taking back its intra day losses and climbing back above its key support at the 1.2766 level, its Jan 23’09 low...

EURGBP: EURGBP Turns Higher Off The 0.8844/38 Area - Declines off the 0.9521 saw a halt Monday bouncing of its strong double bottom support at its Jan 09/16’09 lows at 0.8844/38 to close higher at 0.9004…

EURUSD: Bounces Off The 1.2765 Level

EURUSD: EUR closed higher Monday taking back its intra day losses and climbing back above its key support at the 1.2766 level, its Jan 23’09 low. This present recovery is now seen as a correction of its declines off the 1.3330 level printed in late Jan’09.Its Jan 15’09 low at 1.3026 and its Nov 25’08 high at 1.3081 will be targeted on a build up to the mentioned upmove and then the 1.3298/1.3313 zone, its Jan 06’09 low/Oct 30’08 high. Above here will pave the way for a run at its Jan 19’09 high at 1.3386 followed by the 1.3531 level, its Oct 20’08 high. Its daily stochastics though in oversold zone remains supportive of this view. On the downside, the 1.2766 level, its Jan 23’09 low comes in as the initial downside accompanied by the 1.2330 level, its 2008 low. We see the latter as the trigger for the resumption of its medium term downside. On the whole, EUR continues to remain susceptible to the downside.

Support    Comments

1.2766      Jan 23’09 low.

1.2551      Dec 04’08 low

1.2330      2008 low

Resistance         Comments

1.3081                Nov 25’08 high

1.3298/1.3313    Jan 06’09 low/Oct 30’08 high

1.3386                Jan 19’09 high