HIGHLIGHTS:

GBPUSD: Remains On The Offensive - The pair began the week well in early trading today breaking strongly higher challenging its strong resistance at the 1.6398 level, its Nov 03’09 high and testing a high of 1.6430.

EURUSD: Retarget Of The 1.4361 Level Builds Up - As EUR began the week/month on the bullish side rallying sharply higher in early trading today, its strong overhead resistance residing at the 1.4361 level (Dec 29’08 high) is now being targeted.


GBPUSD

GBPUSD

GBPUSD: Remains On The Offensive

GBPUSD: The pair began the week well in early trading today breaking strongly higher challenging its strong resistance atthe 1.6398 level, its Nov 03’09 high and testing a high of 1.6430. While its bullish theme remains in place, we expect the pair to decisively break and hold above the 1.6398 level setting the stage for further upside gains towards the 1.6673 level, its Oct 30’08 high and then the 1.7518 level, its Oct 19’08 high. Its daily RSI is positive and trending higher suggesting further strength though in overbought zone. On the contrary, pullbacks if seen should initially target its Friday high at 1.6199 with a turn below there accelerating losses towards the 1.6085 level where its May 27’09 is located and then its psycho level at 1.6000 where a cap is expected. Our overall outlook on the pair remains higher and any pullback at this stage is seen as corrective of its general upside tone.


EURUSD

EURUSD

EURUSD: Retarget Of The 1.4361 Level Builds Up.

EURUSD: As EUR began the week/month on the bullish side rallying sharply higher in early trading today, its strong overhead resistance residing at the 1.4361 level (Dec 29’08 high) is now being targeted. EUR remains medium term bullish and a clean break through the latter level will call for further strength towards the 1.4718 level, its Dec 18’08 high with a cut through that level triggering further upside gains towards the 1.4867 level, its Sept 22’08 high.
Momentum indicators ranging from the monthly to the daily remain supportive of its current upside tone. However, if a corrective pullback occurs, lower prices should shape towards the 1.4167 level , its May 29’09 high ahead of the 1.4049 level , its 2009 high. Invalidating the latter will bring continued declines towards its big support level at 1.4000. We expect this level or even the 1.4049 level to reverse roles and provide support thereby turning the pair higher again. On the whole, EUR retains its medium term bullishness and should target additional higher prices with the 1.4361 level seen as the next target.