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Weekly-Daily Forex Technical View – January 14, 2008

Weekly-Daily Forex Technical View – January 14, 2008
Sunday, January 13th, 2008 @ 7:05 am by Bogdan Parascanu

EUR/USD Technical View

Euro opened the week trading lower and slowly slipped toward the 1.4600 support level but after failing to make a new low on Thursday, the day of the ECB interest rate announcement, at 1.4640 it pushed higher for the rest of that day and retested once again an important resistance trendline just above 1.4800. Trading on Friday was slow as the pair stayed contained inside a small range around the 1.4800 level. We have reached a point where bullish traders, the ones that have their sights set on 1.5000, fight with the ones that look at the USD strength and expect a move lower toward the December low at 1.4300. We, for the time being, maintain our rather bearish point of view and that is the following, as long as the the 1.4825 resistance holds we look for shorting opportunities, a break above that resistance will force us to start looking for a test of the 2007 1.4966 November high before reaching the 1.500 psychological target.
Resistance Levels

  • 1.5000– round number
  • 1.4966- Nov 23rd high
  • 1.4735 –Nov 9th High

Support Levels

  • 1.4500- round number
  • 1.4300 – Sept 30th High
  • 1.4000 – Round number
  • 1.3850 – July 24th High

GbpUsd Technical View

GbpUsd continued the drop and broke under 1.9670 on Wednesday after a retest of the 1.9800 resistance on Tuesday morning, the pair found support at the 1.9550 area and printed a weekly low at 1.9480 on Friday but closed the week trading just a few pips above the 1.9550 level. Looking at the weekly chart below we can see the next big bearish target and support level at 1.9180 but that seems pretty far away at the moment and there are a lot of things to consider that might affect the current bearish momentum, perhaps the most important one is FED interest rate decision. So far our projection on cable have come true in 2008 but it’s only been a few days, we expect the pair to move lower and a consistent break of the 1.9550 support will definitely be a big help, conversely a bounce from the current levels supported by the fact that we are in an oversold area on the most of the larger timeframes could trigger a healthier retracement perhaps even toward the 2.0000 level.

Resistance Levels

  • 2.1148 – Nov 9th High
  • 2.1065 – Nov 7th High
  • 2.0650 – July 24th High
  • 2.0365 – September 12th High

Support Levels

  • 2.0000 – Round number
  • 1.9800 – Round Number
  • 1.9670 – August 17th Low


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