Daily Market Technicals 17/01/2001

The yen ended up gaining ground Tuesday in Asia as Japanese exporters were seen showing large offers around the 119.50 level. The pair initially rallied at the open from The New York close at 118.90 to a session high at 119.18 in choppy trading but soon fell quickly back to end at 118.35. The medium term goal is still to break the 120.00 level followed by a potential move for 124.00 yen. The move however will continue to be tempered by the approaching Japanese fiscal year end as companies will repatriate profits from abroad and change them into yen. EURUSD suffered as the EURJPY cross was sold off. The pair opened in the 20’s push up to 0.9440 before sinking back down to just above 0.9400 at the close. AUDUSD was firmly bid today inspired buy a lot of buying in the AUDNZD cross which kept the aussie firm against most other currencies. NZDUSD also remained little changed from its open at 0.4450, but kept from rallying as much due to the AUDNZD buying. GBPUSD seemed firm for most of the session touching 1.4779 but dipped back to its opening level at 1.4760 at the end. One other interesting point to note is that detailed talks of a takeover bid by the Swiss chocolate makers Nestle of Ralston Purina of the US have kept this pair bid and hence the euro softer (due to the inverse relationship of the pair). The size of the deals is approximately 10.0 Bio USD and this is keeping traders on guard in that pair.

EUR-USD

Target 0.9300 Short at 0.9400 Stop at 0.9445

Resistance:0.95290.94750.9444

Support:0.93700.93600.9345

Rebound ahead of 0.9360 support yesterday and inability to sustain below the 0.9400 level keep downside protected. Risk is on a return above the 0.9445/50 resistance to clear the way for test of the 0.9474 mid-point of the 0.9578/0.9370 decline. Only above this would confirm a return to bull play for retest of the 0.9578/93 highs. The 0.9360 level marks key as break would trigger a double top.

GBP/USD

Target 1.4635 Short at 1.4705 Lower Stop to 1.4740

Resistance:1.48211.48031.4750

Support:1.46661.46321.4590

Has seen rebound from the 1.4666 38.2% Fibonacci level which put existing shorts at risk. Scope is seen for retracement to 1.4790/1.4800 resistance where renewed selling is looked for. Only above the 1.4850/56, Fibonacci and former chart support would allow for recovery back to test the 1.5000/30 resistance. Extension through the 1.4666 level see potential to 1.4580/50 area.

USD-JPY

Target 116.60 Short at 117.30 Stop at 117.60

Resistance:118.90118.24117.90

Support:117.30117.10116.90

Failed to sustain downside test below the 117.00 level but upticks to see 117.60 and 118.00 posing resistances. Bearish engulfing candlestick yesterday keep downside vulnerable after recovery attempt stalled shy of the 118.00/24 resistance. Break below the 117.00 level see 116.60 hourly support initial target but potential would be for extension to the 115.50/115.00 zone.

EUR-CZK

Target 35.70 Long at 34.70 Raise stop to 34.85

Resistance:35.80035.62035.450

Support:34.10034.50034.800

Is choppy following the reaction last week from the 35.00 region, which marks key support area for the medium term. A close below here would put longs at risk. For now channel support from the 23-Nov-00 lows lies at 35.10 and is keeping 35.00 protected. Next the 35.45 resistance needs to be taken out to see further upside tests toward the 35.90 channel resistance.

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