Thursday

Daily analysis and trading strategies 12-03-09by Liviu

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Quote of the day: I think that only daring speculation can lead us further and not accumulation of facts. – Albert Einstein

EURUSD

Trading strategy: holding yesterday’s long @1.5045, stop at break-even, 2nd objective at 1.5145 (1st objective closed at 1.5095)

The euro found bids into the support zone of 1.5000/50 region as expected and noted on yesterday, therefore my plan to buy dips at 1.5045 was a good idea, 1st objective of 50 points being reached in overnight trading, also providing an opportunity to hold the position in a risk-free trade (adjusting stop-loss at break-even), aiming for the 2nd objective at 1.5145. Speaking of today’s conditions: upside remains favored as the euro is trading comfortably above the 1.5000 handle, not far below the ytd high at 1.5145. As long as 1.5000 is on the ’safe side’ – not being threatened by extended pullbacks – more upside price action is likely, also showing that recent expensive/overbought prices (resistance into the 1.5000 region) look cheaper today (providing support and points to re-initiate long positions). However, a breach above 1.5150 requires a break above 1113 in S&P500 – that level providing a solid roof so far. Current exchange rate is 1.5096 @06:50 GMT

Support: 1.5030/50, 1.5000, 1.4950/75 and 1.4850/00
Resistance: 1.5145/75, 1.5200/15 and 1.5250

GBPUSD

Trading strategy: stand aside

The falling trend line coming from 1.6870 has been breached, thus marking the 1st ‘check sign’ on uptrend resumption. A sustained break above 1.6700 is also needed – preferably a daily bar/candle close above the said handle. If so, short-term studies will turn positive, opening 1.6870/00 and 1.7000 for extended gains. The 1.6700 resistance is under pressure at the time of writing this, so I’d say that a breach is highly doable – and I wouldn’t sell the Pound, although it is not the best performer against the buck, nowadays. In case of pullbacks, support may be challenged into the 1.6600/15 zone, then lower around 1.6500. As long as 1.6600/15 is intact, odds favor further climbing. Current exchange rate is 1.6687 @06:50 GMT

Support: 1.6600/15, 1.6500 and 1.6400
Resistance: 1.6700, 1.6750, 1.6800 and 1.6870/00

NZDUSD

Trading strategy: stand aside

The kiwi dollar is once again pushing on the rising trend line which provided support for several months – and now providing resistance. A sustained break above the said trend line – now around .7280/00 – would signal a resume of the uptrend, short-term momentum turning positive. Last pullback to as low as .7203 could have been a very good run for my short @.7270 but I called it a neutral trade (closing at break-even) before pulling back below .7220 – C’est la vie! …better luck next time. Keep an eye on this .7280 region – it may breach, eventually, opening .7400. On the lower side, support is seen into the same .7200 zone. Below .7200 would negate the bullish structure, resuming downtrend. Current exchange rate is .7271 @06:50 GMT

Support: .7200, .7160, .7125 and .7025
Resistance: .7280/00, .7350 and .7400

Have a great day!