For December 4th 2009

For December 4th 2009

Questions and suggestions? Contact me at [email protected] Any information contained in this document are based on or derived from information generally available to the public from sources believed to be reliable. There’s no representation or warranty is made or implied that it is accurate or complete. Any opinions expressed are subject to change without notice. This post has been prepared solely for information purposes and does not constitute any solicitation to buy or sell any instrument, or to engage in any trading strategy. Charts were generated using Alpari UK’s MetaTrader 4.0

EURUSD

The rally continued, although slow, and sent EURUSD to hit 1.5141 on Thursday. Subsequently, the pair fell in a zigzag pattern and managed to hit 1.5037. As the pair broke through 1.5116 yesterday, this established 1.5032 as the new significant low and currently being revisited again. The technical level is within the proximity of a crossover at 1.5021 where retracement and projection levels fall at the same price. Should the pair continues to grind down below 1.5021, expect 1.4970 to be tested again. It is likely that at the moment the rally had ended at 1.5141 and that the pair will resume its move downwards, probably below 1.4827. This would be confirmed when 1.5021 is broken. SHORT may be established after the price falls below 1.5021, but immediate entry is possible with stop set above 1.5077. Critical resistance is definitely at 1.5141/1.5144 where a potential double top is currently developing. Downside, targets may be set at 1.4970/1.4984 and later on, 1.4827. Below 1.4827 will confirm the double top and around 300 pips drop below 1.4827 is seen.

GBPUSD

GBPUSD made another climb to hit 1.6720 before it turned south. This means the suggested stop for yesterday had been tripped over. As the significant low at 1.6549 has been broken, the bias is now down. Objectives are seen at 1.6495, 1.6443, and 1.6376 (just below key low at 1.6379). Ultimately, it could go as low as 1.6270 as well. Resistance is difficult to pinpoint since the current slow grind downwards still sees no end in sight. The best guide will be the descending trendline. Once this is broken, I expect a corrective rally to follow. Above the trendline, we have 1.6549 and then peak from yesterday, 1.6720. The trendline could be used as a stop point, so immediate SHORT may be established. Alternatively however, we can also wait until a corrective rally starts and use the recent downswing to pinpoint better entry points based on retracements. Either way, the targets are seen at 1.6495, 1.6443, 1.6376 and later 1.6270.

USDJPY

USDJPY moved past 87.52 resistance and reached 88.47. At the moment it still hovers between 88.10-88.47, waiting for the resumption of the upmove towards 88.64 and then 88.98. Downside, the near-term support is seen at 88.10. Subsequent support levels are seen at 87.63, 86.98, and 86.48. The rise from 85.85 has been contained in an ascending price channel so far, and to alter the bias of the pair, it must fall first below the channel bottom which is approximately at 87.63. Look to enter LONG again, near 88.10 and 87.63. Stop should be set below the price channel with targets set at 88.64 first, then 88.98.