HIGHLIGHTS:

GBPUSD:Recovering Higher Within Its Rising Channel - GBP rose from its one week declines to rally sharply higher Monday through the v1.4662 level, its Feb 23’09 high to close at 1.4851 … Learn more

EURJPY: The 131.06 Level Provides Support - As indicated in our previous analyses, EURJPY turned sharply higher ahead of its key support resting at the 131.06 level, its former range top on Monday to close at 133.88.Though.

GBPUSD: GBP rose from its one week declines to rally sharply higher Monday through the v1.4662 level, its Feb 23’09 high to close at 1.4851. We believe that as long as the pair maintains within its rising channel and above its bigger supports at the 1.3504 and 1.3682 levels, risk remains to the upside towards its April 06’09/Feb 09’09 highs at 1.4986/65 with a break and hold above there triggering the resumption of its recovery started at the 1.3504 towards the 1.5374 level, its Jan 08’09 high. The daily RSI has turned higher supporting this view. Downside targets are situated at the 1.4662 level, its Feb 23’09 high and the 1.4465 level, its rising channel base. On continued weakness lower level prices will be aimed with the 1.4305 level, its Mar 06’09 low coming in as the next followed by the 1.4110 level, its Mar 30’09 low ahead of the 1.3845 level, its Mar 18’09 low. All in all, though GBP retains its longer term bearishness, it remains biased to the upside in the short term

EURJPY: As indicated in our previous analyses, EURJPY turned sharply higher ahead of its key support resting at the 131.06 level, its former range top on Monday to close at 133.88.Though those gains were seen being reversed in early trading today, while the cross holds above the 131.06 support level a recapture of its Mar 24’09 high at 134.52 ahead of the 137.41 level, its April 06’09 high is expected with a sustained break above the latter activating the resumption of its short term uptrend started at the 112.09 level, its Jan 21’09 low towards the 138.55 level, its Oct 20’08 high. Downside objective is initially located at the 131.06 level where a cap is expected. Below that level if seen should put pressure on the 129.72 level, its Dec 29’09 high before the 127.65 level, representing its Mar 13’09 high and possibly the 126.40 level, its Mar 30’09 low. On the whole, though in a corrective mode, EURJPY is expected to resume its upmove activated at the 112.09 level on ending that correction.