Foreign Exchange Market Commentary

EUR/USD closed lower on Wednesday as it extends the decline off last week's high. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it renews this fall's decline, weekly support crossing is the next downside target. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted.

USD/JPY closed lower on Tuesday due to profit taking as it consolidates some of the rally off November's low. Stochastics and the RSI are turning neutral hinting that additional weakness is possible near-term. The mid-range close sets the stage for a steady opening on Thursday. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. Ifit extends this week's decline, November's low crossing is the next downside target.

GBP/USD closed lower on Wednesday as it extends Monday's decline below the 10-day moving average. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are bearish signalling that sideways to lower prices are possible near-term. If it renews this fall's decline, the 2001 low crossing is the next downside target. Closes above last week's high crossing are needed to confirm that a short-term low has been posted.

USD/CHF closed slightly higher on Wednesday as it extends this week's rally. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, October's high crossin is the next upside target. Closes below the reaction low crossing are needed to confirm that a short-term top has been posted.

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