Foreign Exchange Market Commentary

EUR/USD closed higher on Tuesday due to short covering as it consolidated some of last Friday's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are oversold but are neutral to bearish signalling that additional weakness is possible near-term. If it extends this month's decline, weekly support crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/JPY closed higher on Tuesday as it consolidated some of this month's decline. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bullish signalling that a short-term bottom might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a short-term bottom has been posted. If it extends the decline off August's high, March's low crossing is the next downside target.

GBP/USD closed higher on Tuesday and the low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are oversold but remain neutral hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing would confirm that a short-term low has been posted. If it extends this month's decline, the 62% retracement level of the 2001-2007-rally crossing is the next downside target.

USD/CHF closed lower on Tuesday as it consolidates below the 20-day moving average crossing. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are oversold but are neutral to bearish hinting that a short-term high might be in or is near. If it extends this month's rally, last October's high crossing is the next upside target. Closes below the 20-day moving average crossing are needed to confirm that a short-term high has been posted.

HY Markets
http://www.hymarkets.com