Todays Outlook for EUR/USD and GBP/USD

EUR/USD

So, we finally broke through 1.4160/40 yesterday and down we came breaking 1.3970 for 1.3930. Now we have excellent technical support in the 1.3905/01 area from the 50% med term fib level and also more importantly the 200 day moving average. So as you can imagine we are going to see some fierce buying pressure at these lower levels.

However we cannot ignore this change of trend and we are therefore looking at rallies to be correctionary only and we would be selling into strength. Our nearby resistance obviously is the 1.4140/60 area and sellers will be poised here, waiting to drive us lower once more. Sellers are going to hold shorts unless we break through 1.4190.

So this support down at 1.3905/01 is very important. If we break this support then we are abandoning longs and going short looking for this to continue its slump and we woud be looking at the long term uptrend at 1.3700 overall for this coming week.

SHORT TERM FIB LEVELS 

0.236 – 1.4035

0.38 – 1.4100

0.50 – 1.4152

0.618 – 1.4205

0.786 - 1.4279

MED TERM FIB LEVELS

0.236 - 1.4451

0.38 - 1.4147

0.50 - 1.3901

0.618 - 1.3655

0.786 - 1.3305


DAILY PIVOT POINTS

R2 - 1.4417

R1 - 1.4232

Pivot - 1.4109

S1 - 1.3923

S2 - 1.3801

GBP/USD

Cable has broken its uptrend at 1.5880 ad if we look at the above chart we can see that we have now broken the neckline of a large Head and Shoulder pattern that has been building since March.

This pattern does suggest that we have a lot further to go on the downside with the measured target put at 1.5000. Now obviously we are not going to go there in a straight line, but we are looking to be heading that way....Initially we have support in the 1.5785/75 area from longer term 38% fib level, and this may be enough initially to halt the decline and see some correction, but at this point this is what rallies are going to be...They are correctionary and should be sold. If we can see again 1.5880/1.5920 we are looking to re-sell waiting for this 1.5785.75 support to be tested.

If we fail to hold this support we are looking to 1.5650/45 to entice.

SHORT TERM FIB LEVELS. 

0.236 - 1.5987

0.38 - 1.5931

0.50 - 1.5959

0.618 - 1.5987

0.786 - 1.6026

MED TERM FIB LEVELS

0.236 - 1.6417

0.38 - 1.6212

0.50 - 1.6046

0.618 - 1.5880

0.768 - 1.5669

DAILY PIV POINTS

R2 - 1.6123

R1 - 1.6015

Pivot - 1.5949

S1 - 1.5841

S2 - 1.5775