Daily Market Technicals 21/03/2001

A wild ride in the yen today as the dollar and the euro both soar against the currency in a market characterized by illiquidity typical of the Asian hours. The dollar opened at 122.00 yen and remained peaceful initially looking poised to take out rumored stops at the 121.80 level. Soon however the pair had rallied to 122.40 before backing off slightly and then pressing quickly to 122.80 then gapping to 123.05. A short breather back to 122.85 and then an unmerciful move through 123.05 to 123.41 with virtually no dealing going through. The pair looks likely to continue to rally higher, however be on the look out for a surprise rate cut by the fed after a disappointing move by the FOMC of an only 50 basis point cut yesterday. This may temper an aggressive move higher in the immediate future. In other trading the EURUSD pair remained relatively benign throughout the chaos as the other two currency pairs rally against the yen cancelled each other out. AUDUSD and NZDUSD also had fairly quiet sessions softening slightly with the yens decline.

EUR-USD

Target 0.9140 Long at 0.9020 Raise stop to 0.9070

Resistance:0.92110.91470.9129

Support:0.90700.90300.9016

Stalled ahead of the 0.9130/47 chart and 50% Fibonacci level but long position in play while above 0.9070 minor support. Expect the 0.9130/47 area to pose strong resistance and use of trailing stops favoured to protect profit. A break of 0.9147 will be needed to signal a return to test the 0.9200 level. Initial support seen at 0.9070 ahead of the 0.9030, 200-day moving average.

GBP-USD

Target 1.4435 Long at 1.4255 Raise stop to 1.4330

Resistance.1.44861.44361.4395

Support:1.43301.43001.4245

Stalled ahead of the 1.4400 level as hourly tools pushes into overbought territory. However, potential remains for further short term upticks above the 1.4400 level towards the 1.4435/50 former support zone. Bullish engulfing candlestick yesterday is seen supportive but upticks likely to find the going difficult above the 1.4400 level for now. Downside seen protected while above 1.4280/1.4300.

USD-JPY

Range Trade Buy at 122.00 Sell at 123.50

Resistance:124.00123.61123.15

Support:122.08121.86121.20

Stalled ahead of the 123.61 high seen 19-Mar with gains seen struggling to sustain above the 123.00/15 resistance. Overbought daily posture is seen weighing on upside test with sideways trade favoured while below the 123.61 high though the short term focus is on the buy side while the 121.86/122.00 support holds intact. Extension above 123.61 high to see the 124.40/75 attracting.

EUR-CZK

Target 34.00 Short at 34.60 Stop at 34.85

Resistance:35.10034.95034.640

Support:34.50034.35034.150

Stay on a weak footing. Recent violation of the support line from the 34.35 low at 15-Feb weighs on the rate. Scope is now for retest of the 34.35 low which would open up the 34.00 psych level again. Below here focus would be on the 33.75 synthetic low from Aug-98. On the upside 34.60/65 congestion offers initial resistance.

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