Wednesday

Daily analysis and trading strategies 12-16-09

by LiviucloseAuthor: Liviu Name: Liviu Flesar
Site: http://www.innerfx.com
About: I am an independant currency trader providing currency market analysis mainly for two reasons: 1. to improve my discipline, keeping a clear track record of my own thoughts, analyzing both my good and bad expectations on market moves; 2. sharing my thoughts with other traders, hoping they may benefit from my opinions and experience. I don't call myself a veteran or trading guru of some sort as there's a lot more I have to learn, a lot more I have to see and my 8 years experience into currency trading is not enough proof that I will be successful during the next 8 years. I dare to believe that my articles are useful to many traders from around the world and I strive to improve in my attempt to become a better and more accurate writer. innerfx.com is my own project, a blog about currency trading where I share my commentaries and market thoughts. The site has been launched to address the needs of other currency traders and also to keep a track record of my articles. I am not fully dedicated to currency trading because I want to diversify my knowledge, therefore I am involved in different areas.See Authors Posts (1400) on December 16, 2009 – 7:10 am GMT | 1 Comment |

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Quote of the day: The worse a situation becomes, the less it takes to turn it around, the bigger the upside — George Soros

EURUSD

Trading strategy: short at 1.4680, stop at 1.4740 (1% risk), 1st objective at 1.4620, 2nd objective at 1.4560

Offers around the 1.4550 level are being tested at the time of writing this, recovering 50 points which is one third of yesterday’s losses – less than required to confirm the beginning of a prolonged recovery. While the ongoing euro’s recovery continues – important upside barriers to watch are set at 1.4585/00 – downward trend line coming from 1.5140 along with the 61.8% of yesterday’s range – where a potential breach would open the next notable barrier around 1.4680/00 – last week’s bottom which became resistance since Friday’s break down. In case of decline’s extension – 1.4450/65 comes next, below 1.4500. Upside is slightly favored for now, but only on hourly basis. Extended rallies could face strong selling into the 1.46-1.47 range. Interest rate decision in the U.S. later today may also cause some volatile moves, as well providing clues on upcoming market direction. Current exchange rate is 1.4550 @07:10 GMT

Support: 1.4500, 1.4450/65 and 1.4400
Resistance: 1.4585/00, 1.4650 and 1.4700
Market sentiment: long term – bullish, medium term – slightly bullish, short term – bearish, intra-day – slightly bullish

NZDUSD

Trading strategy: holding yesterday’s long at .7200, stop at .7160 (0.5% risk), 1st objective at .7240, 2nd objective at .7300

Downside pressure intensified through the Asian session as the NZD fell below .7200 which provided support yesterday. Since the 50% retracement of last up leg from .7040 to .7315 is still intact, the kiwi dollar might have a chance to recover – so I think it’s better to hold yesterday’s triggered long at .7200, as risk is low – instead of closing now for a small loss. Since this .7180-.7200 region is an important support on a short-term basis, I’d say that the pair is at the crossroad – a potential break lower would re-initiate bearish momentum on the daily charts. I am carefully watching the pair for now and I will probably write an update later today, depending on what will happen. Current exchange rate is .7189 @07:10 GMT

Support: .7180/00, .7150, .7100, .7000/15
Resistance: .7240/50, .7300, .7320/50, .7385/00 and .7500
Market sentiment: long term – bullish, medium term – bullish, short term – slightly bullish, intra-day – bearish

Have a good day!