EURUSD: Heading Back Down Towards The 1.2514 Level - Although indecision pervaded price action through out last week, EUR still managed to close lower at 1.2677 the past week…

GBPUSD: Still Trading and Holding Above The 1.4137 Level- While the upside recovery activated at the 1.3504 level being its YTD low has paused and now correcting, a clean break and hold below the 1.4137 level, its Feb 12’09 low is required to extend that nearer term correction lower …

EURUSD- Although indecision pervaded price action through out last week, EUR still managed to close lower at 1.2677 the past week. With that development, a retarget of the 1.2514 level, its swing low established on Feb 18’09 now looks to provide support with a break and hold below there turning focus to the 1.2330 level, representing its late Oct’08 low. As highlighted in our previous analysis, this level presently represents the bottom of a broader short term range and an eventual invalidation of there will open the door for a run at lower prices at the 1.1860 level, its Mar’06 low and then its Dec’05 low at 1.1640.Its weekly RSI and Stochastics are negative and pointing to the downside suggesting a price follow through lower could be seen.However,on a failure to retest and take out the 1.2514 level, sideways trading with upside bias may be seen targeting its Jan 23’09/Feb 02’09 lows at 1.2706/66 ahead of the 1.2992 level, its Feb 23’09 high. Beyond there should leave the pair aiming at its Feb 04’09/Nov 25’08 highs at 1.3071/81 enroute to the 1.3298/1.3313 zone, its Jan 06’09 low/Oct 30’08 high. On the whole, overall bias remains lower but losses of the 1.2514 and the 1.2330 level must occur to trigger its medium term downtrend on hold since late Oct’08.

GBPUSD- While the upside recovery activated at the 1.3504 level being its YTD low has paused and now correcting, a clean break and hold below the 1.4137 level, its Feb 12’09 low is required to extend that nearer term correction lower. That level has held for a second week in a row and a sustained break below there should accelerate additional declines towards its Feb 02’09/Jan’2002 low at 1.4045 with a loss of there paving the way for a decline towards the 1.3682 level, its Jun’2001 low and next its YTD low at 1.3504.This view is consistent with its broader medium and longer term trends which are pointing to the downside. On the contrary, continued trading above the 1.4137 level will call for a move higher through the 1.4352 level, its Dec 31’08 low and an eventual retarget of its Jan 16’09/Feb 09’09 highs at 1.4981/86 with scope for further upside gains towards the 1.5374 level, its Jan 08’09 high. All in all, despite its present hold above the 1.4137 level, with continued monthly losses being recorded and longer term downtrend being maintained, resumption of that trend looks likely.