Tuesday

Daily analysis and trading strategies 2-9-10by Liviu

Share

Quote of the day: A lot of people are afraid of heights. Not me. I’m afraid of widths. — Steven Wright

EURUSD

Trading strategy: short at 1.3825, stop at 1.3885(1% risk), objective at 1.3725.

The consolidation continues and the euro shows modest signs of recovery, currently testing last two days’ top side into the 1.3720/40 region. Intra-day studies are slightly bullish and a break above 1.3740 would potentially strengthen short-term momentum – thereafter aiming the higher barriers, such as 1.3800 and 1.3850/60. A falling trend line coming from 1.4265 of January 8 has provided support on last two corrective cycles, as seen in the chart below, but we are now dealing with a potential break out above the said line, which would be a notable bullish sign. However, it’s too early to consider this minor recovery a reversal, as current drop from 1.5140 to 1.3585 is a decline of historical proportions – moves of 1500 points down against the dollar in 9 weeks have been seen back in the tumultuous times of 2008. Scrolling back, such declines were also seen back in `91 and `92. Back to current charts – the intra-day bullish structure will remain intact while 1.3650/60 holds. Below the said levels, downtrend will resume – next downside objectives being 1.3550/85 and 1.3500. Current exchange rate is 1.3721 @07:00 GMT

Support: 1.3585/90, 1.3550 and 1.3500
Resistance: 1.3740/50, 1.3800/05 and 1.3850/60
Market sentiment: long term – bullish, medium term – bearish, short term – bearish, intra-day – slightly bullish

NZDUSD

Trading strategy: stand aside

Same as EUR, the kiwi-dollar consolidates recent losses and re-tests the immediate resistance levels around .6900. Above the said barrier, next notable objective is set around .7000, which may limit gains. Short-term sentiment is bearish while below .7100 or so, and the intra-day studies are slightly bullish. Support is seen into the .6800/15 region, backed by .6750. Downside pressure is expected to remain high and selling to emerge in case of minor rallies, up to .7000. Solid reasons are required to favor a break above the 70 cents mark and I can’t think of any, for now. Current exchange rate is .6890 @07:00 GMT

Support: .6850/60, .6800 and .6750
Resistance: .6900, .6980/00 and .7050
Market sentiment: long term – bullish, medium term – slightly bearish, short term – bearish, intra-day – slightly bullish

Have a great day!