EUR/USD has again failed to maintain a minor break of the 55 day ma and sold off back into its range. Directly overhead sit the 1.3305/20 downtrends, and these continue to effectively block the topside. These are the 5 month downtrend and the 8 month channel. We favour failure and a slide back to near term support at 1.2974/54, the February low and 61.8% Fibonacci retracement. Minor support lies at 1.3174/73 ahead of 1.3045. Should the downtrends be eroded (not favoured) – this would imply a retest of the 1.3487/1.3510 recent high and 38.2% retracement of the move down from the 2011 peak.
GBP/USD has charted an inside day and appears to be faltering at the 1.6167 resistance. This is the October 2011 high and the 61.8% retracement of the move seen 2011-2012. We suspect that this will hold the initial test and provoke failure. We have interim support at 1.5984 and will assume while above the market remains bid, only a move back below here alleviates immediate upside pressure. Key support remains the 2012 uptrend at 1.5874 only back below here and the 200 day ma at 1.5843 will negate the topside currently.
Above 1.6170 and we will have to capitulate and just go with it. This would introduce scope to 1.6425/the 78.6% retracement of the move down from the 2011 peak.
EUR/GBP has again sold off and remains on course for the .8067 2010 low. Immediate resistance is the near term downtrend at .8214 and while below here the market remains directly offered. Utilising the consolidation seen last week at .8221 as a mid way point offers .8110 as an interim target en route to the .8067 low. Longer term our bias is bearish as the market has recently broken down from a 3 month consolidation. Rallies are expected to remain capped by .8221, .8277. This is the previous January low and the April high.
USD/JPY has stalled at the 20 day ma and downtrend, today at 81.60/73. While this has provoked a sell off, we look for this to be relatively tepid and consider that the market is well placed to overcome the resistance line for further gains to 83.31/39 then the 84.19 recent high. We suspect that the correction lower terminated at 80.29 and the market is attempting to resume its bull move. A close above the 81.73 resistance line would add weight to this idea and should be enough to trigger a move to 83.31/39 then the 84.19 peak. Minor support lies 80.67.
USD/CHF remains under pinned by .9066, the November 2011 low and the .9064 6 month support line and will look for these to hold the downside and provoke recovery. While above here we will maintain a target of the .9317/42 resistance (October and November 2011 highs and 61.8% Fibonacci retracement of the down move seen this year). Initial resistance lies at .9148/.9168 and the resistance line at .9221.
AUD/USD has sold off in its range and the 1.0260/28 support is exposed, this is the 50% retracement of the move up from the November low and the recent low. The market remains on the defensive following last weeks failure at the 1.0468/38.2% retracement of the move seen from February. Below 1.0228 we look for losses to 1.00 en route to the .9920/.9863 support, the December low. Rallies are likely to find intraday resistance at 1.0385 and remain contained by 1.0468.
EUR/JPY has been rejected by 107.88, the 50% retracement, and the 55 day ma at 107.49 currently. The sell off has so far held interim support at 106.33/105.95 and ideally we would like to see stabilisation and recovery. We suspect that the market has based at 104.625, just ahead of its corrective target of 104.24/103.50. Above 108.00 will see a recovery to 108.62, the 61.8% retracement of the sell off seen in April and then 111.43/57. Minor supports are 106.33/105.93, however key support remains 104.25/103.50. This is the base of the cloud and the 50% retracement of the move seen so far in 2012.
EasyForexNews Research Team