Daily Technical Strategist

Today's Focus: EURUSD & GBPUSD

• EURUSD: Nearer Term Corrective Upside Triggered Off The LT Rising Trendline.
• GBPUSD: Maintains Its Bearish Tone, Prints A Two-Year Low

EURUSD

Unlike GBP, EUR retained a bullish nearer term tone Wednesday closing higher at 1.4745 and trading higher (1.4807) in early session today. This is coming on the back of a bounce on Tuesday off its LT rising trendline established since Jan'06.The mentioned follow through to the upside should now target the 1.4814 level, its August 12'08 low ahead of the 1.4967/51 zone (its range highs from Nov'07 and Jan'08/.618 Ret) and the 1.5304/1.5285 zone (May/Jun'08 lows).While these two strong resistance levels hold, EUR is expected to turn lower and resume its broader weakness triggered off the 1.6037 high. The daily Stochastics has turned higher above the oversold territory, its first since dipping below there in late July'08.This remains in alignment with its nearer term corrective tone. Supports now come in the 1.4728 level, its .786 Ret (1.4310-1.6038 rally) with a loss of there setting the stage for a move towards its August 19'08 low at 1.4630 and next its LT trendline/range breakout point at 1.4580/65.Further decline through the latter will risk losses towards the 1.4364 level, its Jan 22'08 low. On the whole, with EUR retaining a bullish nearer term positive tone supported by a higher stochastics, strength is likely to be seen nearer term though such gains remain corrective of its recent declines.

GBPUSD

GBP's bearish medium term structure remains intact having reversed its intra-day gains (1.8488) to register a two-year low of 1.8283 before closing Wednesday trading session at 1.8386. Further downside losses continue to be expected targeting its Wednesday low/descending triangle breakout price target at 1.8283/74 with a break through there clearing the way for additional weakness towards the 1.8176 level, its July 16'06 low. Beyond there will leave the pair focusing on the 1.8090 level, its Jun'06 low. Momentum indicators on the weekly and monthly time frames remain clearly supportive of this view.However, recovering from the present weakness should see the pair aiming at the 1.8510/17 levels, its August 15'08/Oct 08'06 lows at first and then the 1.8745 level, its .618 Ret (1.7250-2.1160 rally) where a break could push the pair towards the 1.9009 level, its weekly 200 ema.In short, GBP remains pressured to the downside having resolved lower from its range and seen continued weakness.

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