HIGHLIGHTS:

GBPUSD: Struggling And Vulnerable- Although GBP continues to struggle at the 1.4137 level, its Feb 12’09 low and resist downside pressure, while it remains trapped within its ST falling channel, lower level prices are expected

USDJPY: Loss Of Momentum To Target The 96.86 Level And Below - An unsustained test of the 99.68 high Thursday saw the pair tumbling to close lower at 98.14.

GBPUSD: Although GBP continues to struggle at the 1.4137 level, its Feb 12’09 low and resist downside pressure, while it remains trapped within its ST falling channel, lower level prices are expected. In such a case, the 1.4137 level will aimed at before its Jan’2002 low at 1.4045 and then the 1.3682 level, its Jun’2001 low with the bigger support residing at its 2009 swing low at 1.3504.Immediate risk to this analysis will be a continued hold above the 1.4137 level and an eventual recovery higher towards its ST declining channel top presently at 1.4440 where a loss will expand further upside towards the 1.4662 level followed by its Jan 16’09/Feb 09’09 highs at 1.4981/86.Above there if seen will resume its recovery higher off the 1.3504 towards the 1.5374 level, marking its Jan 08’09 high. All in all,GBP’s current back and filling moves remain corrective of its overall longer term downtrend triggered off the 2.1161 in Nov’07.

USDJPY: An unsustained test of the 99.68 high Thursday saw the pair tumbling to close lower at 98.14.It was seen heading sharply to the downside in early morning trading today suggesting a move towards its Feb 27’09 low at 96.86 could follow. Below there will clear the way for a decline towards its psycho level at 96.00 before the 94.62 level, its Jan 06’09 high where a cap is expected to turn the back up. While the latter level holds,USDJPY still maintains its recovery started at the 87.13 area. On the other hand, initial resistance lies at the 97.43 level, its Nov 24’08 high followed by the 98.71 level, its Feb 26’09 high ahead of its psycho level/Nov 04’08 high at 100.00/55 with a cut through there putting the next upside target at the 102.22 level, representing its double bottom break out price objective. On the whole, with the loss of upside momentum, corrective pullbacks are now expected to push the pair lower.