Daily outlook and trading strategies 08-18-09

EURUSD

Trading strategy: short at 1.4260, initial stop at 1.4320, objective at 1.4160. Adjust stop to breakeven on +30 pips (at 1.4230) if reached

Current recovery to 1.4135 is not enough to switch bias and signal uptrend’s resumption and downside pressure remains high for now. Overcoming the whole 1.4130-1.4170 region and closing (a daily bar) above 1.4200 would resume uptrend. Another important barrier on the upside is seen around 1.4260 – formed by the falling trend line seen on the 4′hrs chart below. Renewed selling should emerge into that zone on a rally. Intra-day sentiment is slightly positive and the German ZEW Economic Sentiment release later today could be the catalyst of an extended recovery but watch for broad selling on the 1.4200 handle and 1.4260, eventually. Current exchange rate is 1.4117 @06:00 GMT

Support levels: 1.4040/50, 1.2980/00 and 1.3840/50
Resistance levels: 1.4125/35, 1.4175/00 and 1.4250/60

AUDUSD

Trading strategy: stand aside

The Aussie dollar has found good support at .8175 – last week’s bottom. First important resistance is formed by .8320 and a break will resume uptrend. Intra-day sentiment is slightly bullish but keep an eye on .8155/75 in case of resuming the decline, as a potential breakdown would open .8080/00. Current exchange rate is .8241 @06:00 GMT

USDJPY

Trading strategy: short at 95.80, initial stop at 96.30, objective at 95.10. Adjust stop to breakeven on +30 pips (at 95.50) if reached

Short term sentiment remains bearish and current recovery seem corrective. On the recent breakdown below 94.75, the dollar failed to extend gains to my projected target on the 94.00 handle and switched direction after reaching a low at 94.20, by 20 points away from the projected target. Resistance is under pressure at 95.00 at the time of writing this and a potential break should open the 95.80-96.00 resistance zone. Current exchange rate is 94.94 @06:00 GMT

Support levels: 94.95, 94.00/20 and 93.00
Resistance levels: 95.00, 95.50 and 95.80/00

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Post tags: AUDUSD, EURUSD, USDJPY