Forex Technical Update

Euro: Euro tumbled on the back of ECB Chairman, Mr. Trichet speech when he said the region is in an 'episode of weak activity' thus witnessing a remarkable 333 pips movement yesterday. 4-Hourly & Daily charts have just corrected in the oversold region while Hourly charts are moving downwards. Resistance at 1.4445 (21 4-hourly EMA) levels if held can push Euro down to 1.39 levels though reversal can be witnessed anytime. Key focus is on the Non-Farm Payroll today. (Eur/Usd: 1.4310).

Pound: Cable witnessed no respite as it was again hammered despite the interest rate remaining unchanged and weaker than expected Jobless Claims & ADP employment numbers. Cable was pushed down to 1.7536 low this morning with the 4-hourly showing further selling pressure. Next important support comes in at 1.7378 (200 Monthly EMA) Intraday bias continues to remain on the downside. Keep accumulating shorts at higher levels. (Gbp/Usd: 1.7573).

Yen: The pair plunged almost 159 pips yesterday breaching and closing below the 100 Daily EMA at 107.06 (since 17th July '08). In the Japanese session this morning, the pair further weakened to 105.68 levels and is now taking the resistance of 100 Daily EMA with the charts heading towards the oversold region. Initiating longs around 104.95 (38.2% of the rise in weekly) for 80-100 pips can be considered. (Usd/Jpy: 106.70).

Rupee: Rupee remained volatile yesterday as it fell to an intraday low of 44.54 and later climbed to 44.21 before ending the day at 44.33/34. Partial trimming of rupee gains were seen at the close of session as the oil companies and banks bought dollars. Inflation slightly softened to 12.34% as against 12.40% last week bringing little respite to rupee today. (Usd/Inr: 44.29).

Swiss Franc: The pair surged 171 pips yesterday from the lows of 1.1007 to touch the high of 1.1178. The 4-hourly and daily chart are showing selling pressure with cluster support coming in around 1.1067 levels (21 4-hourly & 100 Hourly EMA & 50% Retracement in weekly fall). Sustained trading above this level can send the pair to 1.13 levels. (Usd/Chf-1.1088).

Australian Dollar: Aussie nose dived almost 290 pips yesterday breaking past the long term trendline and the 200 Weekly EMA to touch the low of 1.8103. Aussie is currently trading at 0.8150 levels with the daily stochastic highly oversold. Breaking of psychological 0.80 support can push Aussie to 0.79 levels (38.2% retracement of rise in monthly) whereas on the upside 0.8320 should hold. (Aud/Usd-0.8172).

Gold: Gold has shown a significantly volatile session yesterday moving $24.35 after touching an intra day high of $814.65 and closing below the $800-mark. The 4 hourly, daily and weekly stochastic is oversold with strong support at $774.97 (August 15, 2008 low). Opportunities to initiate longs around those levels could be considered. Contrarily initiate shorts around $804 for $5-7 intraday. (Gold: $798.50).

Dollar index : Dollar index's strength cannot be questioned as it is currently trading close to 79 levels with the stochastic poised at overbought region at 90.19%.

RCPL FOREX
www.rcplforex.com

DISCLAIMER

These views/ forecasts/ suggestions, though proferred with the best of intentions, are based on our reading of the market at the time of writing. They are subject to change without notice.Though the information sources are believed to be reliable, the information is not guaranteed for accuracy. Those acting in the market on the basis of these are themselves responsible for any profits or losses that might occur, without recourse to us. World financial markets, and especially the Foreign Exchange markets, are inherently risky and it is assumed that those who trade these markets are fully aware of the risk of real loss involved.