EUR: Possibly attempt small longs at 1.4425; stop well below 1.4400

Nicole Elliott from Mizuho Corporate Bank at 01/15/10

Comment: Still struggling to close above the 26-day moving average at 1.4496 and the 1.4550 area. Unlikely to break above here today though a weekly close above 1.4500 might still be possible. Mixed at best today.

Strategy: Possibly attempt small longs at 1.4425; stop well below 1.4400. Short term target 1.4545,.

Comment: Dropping below the ‘neckline’ of a small ‘head-and-shoulders’ formation and below the bottom of the daily Ichimoku ‘cloud’. Next step, take out the 26-day average and then the bottom of the weekly ‘cloud’ at 129.60.

Strategy: Attempt small shorts at 131.20/131.50; stop above 133.65. Short term target 130.00/129.60.

Comment: Sterling and the yen this week’s best performers, reversing their position in December. Cable is cautiously pushing into a large Ichimoku ‘cloud’ and moving averages look set to cross to bullish. Note the daily ‘cloud’ narrows sharply by the 26th of this month so prices should be able to break through it eventually.

Strategy: Attempt longs at 1.6315, adding to 1.6255; stop well below 1.6100. Add to longs on a sustained break above 1.6415 for 1.6555 short term.

Comment: Consolidating around the lower levels of the last three weeks, testing the 26-day moving average at 90.98 today, and below the 9-day one. Expect more of the same this morning prior to another drop late today. A weekly close clearly below 91.00 should turn momentum bearish.

Strategy: Sell at 91.05, adding to 91.50; stop above 92.05. Short term target 90.90, then 90.00.