Daily Market Technicals 30/01/2001

In a quiet session the dollar was for the most part supported as the market takes a cautious approach ahead of a packed week. On Tuesday the Federal Reserve opens two days of talks which, it is feared, may result in the sanctioning of a 50 basis point reduction in rates. There is also a series of indicators that will let the Fed know just how much they have to do to turn the economy around and avoid a much dreaded hard landing. The uncertainty ahead of the week is being reflected in the continued to and fro action seen in the dollar. USDJPY opened the session at 117.35 and hovered around 117.50 the bulk of the session, 23 points higher than the Friday close. The currency pair was offered the bulk of the session as weak longs took profit ahead of the week to come. The currency pair settled around 117.24 having traded in a 117.22/69 range. EURUSD opened the session at .9237 and sold off early (session low .9221) before rallying to set the session high at .9256. The currency pair sold off slightly late in the session to settle around .9240. USDCHF was quiet following a 1.6526 open. The currency pair traded higher breaking above 1.6550 (session high 1.6550) before retreating slightly before finding support at 1.6500 from where it bounced to settle around 1.6526. GBPUSD opened the session at 1.4614 and traded in a narrow range around the session high 1.4615 before breaking below and settling just below 1.4600. AUDUSD and NZDUSD opened the session at .5446 and .4363 and traded in .5433/50 and .4362/74 ranges respectively.

EUR-USD

Target 0.9080 Short at 0.9235 Lower stop to 0.9215

Resistance:0.92590.92350.9210

Support:0.91500.91110.9070

Risk is on the downside while below the 0.9210 level with the 0.9150 initial support ahead of the 0.9111 low seen last week. Below this see bear play targeting the 0.9080 level though potential would be to the 0.9020/00 200-day moving average support. Upside to see 0.9210 and 0.9235 reverting to resistance with short term focus on shorts while below the 0.9260/90 area.

GBP/USD

Range trade Sell at 1.4670 Buy at 1.4530

Resistance:1.47371.46851.4610

Support:1.45581.45121.4505

Hold above the 1.4526/12 support leaves tone consolidative though there remains risk on the downside with triangle formation on daily chart threatening break lower. Bullish divergence on the daily stochastics lends support and above the 1.4512 100-day moving average keep downside protected. Look for lift above 1.4685/1.4737 resistance to improve the short term outlook.

USD-JPY

Target 116.00 Sell at 117.20 Stop at 117.50

Resistance:117.75117.40117.00

Support:116.30116.12115.60

Holds supportive tone above the 116.15/12 area keeping the downside protected. However, upticks remain a sell into 117.00/30 resistance zone with stops placed just above 117.40 trendline resistance on the hourly chart. Descending triangle formation on the daily chart see risk for a break below 116.15/12. Only above 117.40 trendline resistance would allow for recovery to test 117.90 and 118.50.

EUR-CZK

Target 34.60 Sell at 35.10 Stop at 35.35

Resistance:35.80035.32535.100

Support:34.68034.60034.520

Last week broke trendline support then running thru 35.15/20 area, giving s/term bear signal. Initial retracement to 34.80 area (50%) was seen, providing some support, and still favour selling rallies. Later scope for 61.8%, to 34.60. Good resistance should emerge from congestion at & below 35.325. Main risk to the bear view is a break/hold above this.

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