Daily analysis and trading strategies 4-23-10

EURUSD

Trading strategy: looking to sell at 1.3295, stop at 1.3355 (1% risk), 1st objective at 1.3245, 2nd objective at 1.3205

The euro fell to a fresh yearly low on concern about Greece, reaching 1.3201 in overnight trading, as massive stop loss orders below 1.3260 (recent bottom) accelerated the decline by 50 points in a matter of minutes. Since there are no technical or fundamental reversal signs, there could be more downside to the single currency – aiming the $1.3 objective on a short-term basis. Rallies will likely face resistance around former support at 1.3260 but there’s a lot of room to the upside for pullbacks, therefore potential corrective rallies may extend to as high as 1.3360 / 1.3400 not affecting the short-term momentum. My yesterday’s secondary strategy to initiate a low risk long at 1.3300 had no chance of surviving against the collapsing EUR. Selling on pullbacks remains the preferred strategy for now. Current exchange rate is 1.3225 @06:30 GMT

Support: 1.3200, 1.3150 and 1.3100
Resistance: 1.3260, 1.3300, 1.3360 and 1.3400
Market sentiment: long term – bullish, medium term – bearish, short term – bearish, intra-day – bearish

GBPUSD

Trading strategy: standing aside

Cable is losing ground and shows signs of weakness as the rally toward 1.55 was short lived. Intra-day support is seen at 1.5300, only 35 points away from current trading levels. In case of a break down, next downside barrier comes around 1.5140/50. Short-term sentiment is still positive, but a break below 1.5300 – potentially extending to 1.5150, would signal a reversal. Current exchange rate is 1.5328 @06:30 GMT

Support:  1.5300, 1.5250 and 1.5140/50
Resistance: 1.5400, 1.5450/70 and 1.5500
Market sentiment: long term – bearish, medium term – bearish, short term – bullish, intra-day – bearish

Have a great day and weekend!

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Post tags: EURUSD, GBPUSD