EUR: Attempt small longs at 1.4935; stop below 1.4800

Nicole Elliott from Mizuho Corporate Bank at 10/21/09

Comment: Hovering under this year’s high at 1.4994 and we shall watch closely to see whether the 9-day moving average will once again limit the downside. Small signs of instability, here and in several other currencies, so today may not be the day latecomers arrive at the party. Note that consensus opinion at the beginning of this month was that the Euro would weaken against the US dollar.

Strategy: Attempt small longs at 1.4935; stop below 1.4800. Add to longs on a sustained break above 1.5000 for 1.5245 short term.

Comment: Hovering around the mid-point of the broad range that has held since late March, possibly with a slightly greater chance of an initial squeeze higher followed by a sharp fall. Very tricky to trade.

Strategy: Possibly attempt tiny shorts at 135.50; stop above 136.25. Short term target 133.00.

Comment: Consolidating under trendline resistance and a thin Ichimoku ‘cloud’. Allow for a little more hesitation here this morning, maybe all day, prior to a break higher and test of important resistance around 1.6665. Note the rapidly rising 9-day moving average and the way the ‘cloud’ thins in five days’ time, which may help the lagging Span break higher.

Strategy: Attempt small longs at 1.6400, adding to 1.6300; stop well below 1.6240. First target 1.6600/1.6665.

Comment: Hovering under trendline resistance and even if we break above here there are plenty of resistance around 91.65. We continue to watch for signs of topping between current levels and first Fibonacci resistance. Note that the lower edge of a descending Ichimoku ‘cloud’ and moving averages still suggest a short position.

Strategy: Attempt small shorts at 90.75; stop above 91.50. Short term target 90.00, then 89.50/89.25.