FX Thoughts for the Day

USD-CHF @ 1.1175/78...Holding Long

USD-CHF @ 1.1178/82...Three Short term views

R: 1.1354-73 / 1.1404-07 / 1.1437
S: 1.1085 / 1.1049 / 1.0990

Our overall view has not changed much since the morning in Dollar-Swiss. We await the resolution of the triangle to confirm the potential S-H-S formation. To see the chart, click on: http://www.kshitij.com/graphgallery/chfcandle.shtml#candle

There could be three views at this point:

a) The pair could either move sideways with a sligltly upside bias over the next few days till the resolution of the triangle. Beyond which it could either go up or down. (i) If it goes up after the resolution it could possibly confirm the formation of S-H-S (above the Neckline) or (ii) a downward resolution could relinquish the S-H-S formation possibility.

b) The pair could be headed higher beyond 1.1350 immediately which could confirm the S-H-S formation which could take the pair upwards of 1.19 over the next few days.

c) the pair could be headed lower below the trendline Support as seen in the daily chart which could potentially remove the chances of S-H-S that we had mentioned.

Presently, given the sideways movement which the pair has been seeing over the last couple of days, the 1st view mentioned above looks likely to be true and the range for the day could be 1.0990-1.1373. Also note that the the range thrown out of the trendlines on the charts is also confirmed by the Projected Max High & Max Low of the day in "At a Glance"

Cable GBP-USD @ 1.4583/86...Break below 1.46

R: 1.4650 / 1.4700 / 1.4750
S: 1.4500 / 1.4460-50 / 1.4400

The pair continues to slip lower as the economic data continues to worsen adding to the doom and gloom. The UK Trade Balance (Goods and Services) released this morning was below the expectation at Stg -4.5Bln. To see the chart of the data release click on: http://www.kshitij.com/fundamentals/funcharts/uktrbal.shtml

The day ahead is likely to see the pair remain pressured lower by the dollar bulls. 1.4500 seems a likely target for the day ahead, with 1.4300 possible later this week. An unlikely bounce could face some Resistance near 1.4700-4750.

Look for opportunities to short near 1.4700.

Aussie AUD-USD @ 0.6687/90...Support at 13-week MA

R: 0.6766-90 / 0.6849-71 / 0.6895-922
S: 0.6656-47 / 0.6604 / 0.6570

Aussie continues to dip further and in the process slipped below the 61.8% fibonacci retracement level of the rise from 0.4775 (April 2001) to 0.9851 (July 2008) at 0.6714 and looks all set to dip towards the 13-week MA at 0.6666. This could be an important Support level for the pair as of now, below which test of 0.6500, the lower end of the broad longer term range, could be targetted. A rise could be restricted to 0.6951 for the day.

Kshitij Consultancy Service
http://www.fxthoughts.com

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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 responsibly 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.