Daily Technical Strategist

Today's Focus: EURUSD & GBPUSD

• EURUSD: Recovers Off 1.5288 Low, Price Action Remains Corrective
• GBPUSD: Broader Bias Remains Lower Towards The 1.9360/35 Area

EURUSD

EUR recovered higher to close the session at 1.5405 Thursday after pushing below its May 02'08/Mar 24'08 lows/.382 Ret (1.4438-1.6018 rally) at 1.5360/41 on intra basis. A follow-through to the upside in early trading today suggests that the said recovery off the 1.5288 low has some more upside to go. In such a case, the 1.5510 level, its April 03'08 low will serve as nearby resistance followed by the 1.5593/1.5626 zone, its May 05'08 high/April 07'08 low/psycho level and then the 1.5710 level, its April 18'08 low. Above the latter will open up risk towards the 1.5895 /me 5912 area, its Mar 31'08 /April 10'08 highs and then its psycho level/YTD high at 1.6000/18.Its daily RSI remains supportive of this view as it has turned higher. On the other hand, a break and hold below the 1.5360/41 zone will be required to trigger the resumption of its decline from the 1.6018 high towards the 1.5164 level, its .50 Ret (1.4309-1.6018 high) ahead of its .618 Ret at 1.5048.On the whole, although a nearer term recovery is now in place, its short term downtrend still dominates suggesting lower prices after that correction.

GBPUSD

While GBP continues to trade below its eroded support at the 1.9598 level (April 15'08 low), risks for a push towards its 2008 lows at 1.9360/35 and beyond are likely. If that is seen, further weakness targeting the 1.9180 level, representing its Mar 04'08 low should follow. Both the daily and weekly studies remain in alignment with this view. The 1.9598 level is now expected to revert to resistance on any recovery from the present level where a break could cause further corrective recovery towards the 1.9727/19 area, its Mar 05'08/April 01'08 lows ahead of the 1.9963/ 2.0026 levels, its Feb 27'08/April 21 & 28'08 highs and then the 2.0191 level, its Mar 27'08 high. All in all, pressure continues to build on the downside with the 1.9360/35 zone serving as the next objective.

Mohammed Isah
Market Analyst
www.fxtechstrategy.com

This report is prepared solely for information and data purposes. Opinions, estimates and projections contained herein are the author's own as of the date hereof and are subject to change without notice. The information and opinions contained herein have been compiled or arrived at from sources believed to be reliable but no representation or warranty, express or implied, is made as to their accuracy or completeness and neither the information nor the forecast shall be taken as a representation for which the author incur any responsibility. The does not accept any liability whatsoever for any loss arising from any use of this report or its contents. This report is not construed as an offer to sell or solicitation of any offer to buy any of the currencies referred to in this report