FX Thoughts for the Week

USD-CHF @ 0.9225/28...Ranged with bearish bias

R: 0.9250 / 0.9300 / 0.9350
S: 0.9100 / 0.9075 / 0.9000

Dollar-Swiss was ranged this week between 0.9100-9250. The 21-Month-MA (currently at 0.9261) is holding well. While below this Resistance level, we see a threat on the charts of seeing a fall to 0.8800. Support is seen at 0.9075 and a strong break below this Support level would trigger this fall. On the upside we see series of Resistances in the broad 0.9300-500 region. Having said this the pair could continue to remain pressured on the downside. However, there are talks in the market that the SNB could intereve at anytime. This will have to be seen. With the absence of the SNB, we would be more biased on the downside for a test of 0.8900-8800.

Trade ideas for the week:

1) Buy in to bounce from 0.9100-9075 Support region
2) Sell on a break below 0.9075

Cable GBP-USD @ 1.5775/78...Bullish. Buy dips

R: 1.5820 / 1.5882 / 1.5939
S: 1.5745 / 1.5700-680 / 1.5650

Cable has risen well last week and has closed above the 100-Week-MA (currently at 1.5745). This 1.5745 (55-DMA) and 1.5700 are the significant Support levels to be watched and while above these Supports the outlook is bullish for a test of 1.6000-30. The 21-Month-MA (currently at 1.5882) that is holding well as of now and the 200-DMA (1.5939) are the intermediate Resistances to be watched. OVerall we are bullish on the pair for a test of 1.6000-30 and we will be looking to take Long positions on dips to 1.5700. Also we will be watching the market carefully as the chances of seeing a bounce back from the 100-Week-MA (1.5745) itself cannot be ruled out.

Trade ideas for the week:
1) Buy on dips to 1.5700

Aussie AUD-USD @ 1.0711/14...Bullish

R: 1.0735-50 / 1.0800
S: 1.0670 / 1.0610 / 1.0570

Aussie broke above its important 1.0735-50 and is coming off from its high of 1.0794. The pair is looking strong with good Support in 1.0610-570 region. Dips to this Support region if seen can be bought. As we had mentioned last week, the long term picture is very bullish and we see no immediate threat on the downside for the pair. As we continue to remain bullish, we are repeating the significant observation on the chart once again this week as well.

Wedge 1: Wedge formed by joining the highs of 1.1065 (Aug-11) and 1.0753 (Oct-11) and the lows of 0.9387 (Oct-11) and 0.9663 (Nov-11). A bullish breakout of this wedge 1 has already happend and a bounce back from the low 1.0427 (24-Jan-12) has given a confirmation signal for this bullish breakout. Having said this the upside target of this pattern will be 1.1900.

Wedge 2: Wedge formed by joining the highs of 1.0764 (Aug-11) and 1.0753 (Oct-11) and the lows of 0.9387 (Oct-11) and 0.9663 (Nov-11). This wedge is yet to see a break out. The wedge Resistance is coming in 1.0735-50 region. Having said this a strong break/close above 1.0750 will be a bullish breakout of this Wedge 2 and the target of this wedge would be 1.2100.