GBP/USD, EUR/USD and STG/EURO
Fri, May 1 2009, 06:23 GMT
by Carol Harmer
GBP/USD
Sellers capped the market just before 1.4950 and kept pushing it lower until reaching 1.4704. Not to be outdone, buyers then grabbed hold of it, but failed to get through 1.4950 and today we are a little lower.
Below 1.4765 sees sellers once more head for the downside with 1.4708/04 once more targeted. Buyers will automatically defend this support as it is the first longer term retracement target. However if sellers want to end the week on a weaker note they will try their hardest to push the market down through 1.47 for 1.4620/16. However buyers are expected to stand firm at the 1.4708/04 level and they will not be defeated easily. As they will defend so religiously if they cave and the sellers win it will be quite a quick move lower to the stated support of 1.4620/16.
Now if current level holds and 1.4825 breaks, once more you are looking at 1.4950. Profit taking will emerge. If buyers break 1.4960 look for 1.5068/88.
EUR/USD
Buyers initially lost out to the selling pressure yesterday, but then turned it around, breaking 1.3340 for 1.3387 which was our target area. Sellers also had this in their minds as the market has once more come lower overnight to 1.3219.
If it struggles this morning to rise above 1.3280 sellers will want to take control and push this lower . Back below 1.3215 sees the sellers rally the troops and march lower through 1.3192 to 1.3175. Sellers will be looking to take profits this. Buyers at this short term 50% fib level know they have to staunchly defend this point otherwise the wrath of the sellers will come down on them and obliterate most of the gains we have seen this past week.
To ease any further downward pressure buyers need to push like crazy and try and break back above 1.3280. If this occurs buyers will gain confidence and then it will break higher with 1.3381/93 once more exposed. Buyers will only re -instate longs above 1.3409.
STG / EURO
Stg/Euro traded higher yesterday, coming up to 1.1202 before selling pressure prevailed. Now this support is between 1.1120 and 1.1115.
If this support can hold then you should look for buyers to take this higher with another test of 1.1202 looking viable. Here buyers will stamp their mark and take profits. Only brave buyers would buy over 1.1233. If they did, then they would be rewarded with rallies through to 1.1254/63., where again profits would be expected to be taken.
If the sellers get their way and break 1.1115, you will see them aggressively sell lower to 1.1045 possibly 1.1006 before their lust for buyers blood abates. Wounded buyers would come in at these lower levels and shift around looking for bargains that hold above the longer term fib level of 1.0968.
