Technical Analysis for Major Currencies

EURO

The European currency versus Greenback was able to breach the previous discussed neckline of the classical head and shoulders top pattern. Now some kind of consolidation is highly anticipated on the intraday basis as a normal effect for the oversold sign appearing on RSI but we see that it will be followed by a downside action towards the technical target of the overall structure around 1.3325 zones.

The trading range for today is among the key support at 1.3325 and the key resistance at 1.4235

The general trend is to the downside as far as 1.4710 remains intact with targets at 1.2120

Support: 1.3760, 1.3700, 1.3645, 1.3590, 1.3540
Resistance: 1.3830, 1.3900, 1.3945, 1.4000, 1.4050

Recommendation: According to our analysis, sell the pair below 1.3775 with targets at 1.3650 and stop loss with four hour closing above 1.3865

GBP

A double top formation is in progress for the time being as seen on the above four-hour chart. Hence the bearishness occurred yesterday is anticipated to continue on the intraday basis. Note that AROON indicator is showing that the major action is still downward while Stochastic shows that a very slight correction is needed before resuming the downtrend.

The trading range for today is among the key support at 1.5830 and the key resistance at 1.6525

The general trend is to the upside as far as 1.4840 remains intact with targets at 1.6830

Support: 1.6215, 1.6175, 1.6100, 1.6000, 1.5895
Resistance: 1.6325, 1.6385, 1.6425, 1.6500, 1.6560

Recommendation: According to our analysis, sell the pair below 1.6270 with targets at 1.6050 and stop loss with four hour closing above 1.6475

JPY

The USD/JPY pair was resisted strongly around the pivotal resistance areas of 98.50; whereas it formed consecutive bearish formations appearing clearly on the candlesticks. Now this bearishness is expected to continue today as EMA 10-80 lines started to overlap negatively. Note that AROON indicator supports this intraday negative scenario.

The trading range for today is among the key support at 93.40 and the key resistance at 100.70

The general trend is to the downside as far as 102.60 remains intact with targets at 84.95 and 82.60

Support: 96.35, 96.00, 95.55, 95.10, 94.65
Resistance: 97.10, 97.75, 98.15, 98.50, 99.00

Recommendation: According to our analysis, sell the pair below 96.90 with targets at 95.40 and stop loss with four hour closing above 98.00.

CHF

A daily harmonic Gartley pattern is under construction for the time being accompanied by yesterday's bullish candlestick, which encourages us to say that the Dollar versus Swissy is still expected to continue its bullishness toward the first technical target of the pattern -D- areas around 1.1155 whereas a breakout above it will open the door for additional positive actions while AROON supports our scenario.

The trading range for today is among the key support at 1.0585 and the key resistance at 1.1230

The general trend is to the upside as far as 1.0570 remains intact with targets at 1.2245

Support: 1.0840, 1.0790, 1.0745, 1.0665, 1.0570
Resistance: 1.0930, 1.0980, 1.1020, 1.1080, 1.1155

Recommendation: According to our analysis, buy the pair above 1.0840 with targets at 1.0980 and stop loss with four hour closing below 1.0770

CAD

After building a solid technical base at the 1.1170 support level, the Dollar versus Loonie pair continued to incline, forming a harmonic Crab which is expected to form a potential reversal zone -D- around 1.1500 zones. Now a very slight correction is needed to relieve the indicators and to give the pair the momentum it needs to continue its projected bullishness. Note that a breakout above 1.1380 will accelerate our scenario.

The trading range for today is among the key support at 1.1040 and the key resistance at 1.1600.

The general trend is to the downside as far as 1.1870 remains intact with targets at 1.0300

Support: 1.1300, 1.1245, 1.1210, 1.1170, 1.1135
Resistance: 1.1380, 1.1430, 1.1490, 1.1525, 1.1600

Recommendation: According to our analysis, buy the pair above 1.1310 with targets at 1.1450 and stop loss with four hour closing below 1.1200.

FUNDAMENTAL ANALYSIS

Here is the video:
06-16-2009.swf

I talked about a lot of topics in the video today, and even discussed some specific position trades I am in and recommend, so I highly encourage you watch this one, so the text synopsis is going to be much shorter to encourage that =P We've seen a large technical shift towards USD strength that I've been talking about for the last couple of weeks, and there's some good sentiment and correllations behind it as well. Day to day, it's hard to say each might head (bounce, or continuation?), but medium to longer term I think we still have much lower to go on EU, GU, Gold, and stocks. Again watch the video for much more detail. For news tomorrow:

0430 UK CPI y/y (headline) (2.0% expected) - I'd stay out if there are any conflicts with the m/m or core numbers.
If it comes out at 2.2%, GBP/USD should rise 40 pips or more in the first 45 minutes of the report.
If it comes out at 1.8% or lower, GBP/USD should sell off 40 pips or more in the first 45 minutes of the report.

0500 German ZEW Economic Sentiment (35.0 expected) - Mild positive numbers have given only small upmoves so far, so I'd like to see 15 above expectations for a buy given the downtrend.
If it comes out at 50.0 or higher, EUR/USD should gain 30-40 pips in the first 30 minutes.
If it comes out at 24.0 or lower, EUR/USD should fall 30-40 pips in the first 30 minutes.

0830 US Housing Starts & PPI figures- (H.S. expected at 485K) If PPI has a big deviation, I'd stay out and watch, but if the PPI figures come out roughly within 0.1% of expectations, I'd sell EUR/JPY on a Housing Starts at 430K or below, and buy EUR/JPY on a Housing Starts 550K or above looking for 40-50 pips in 35 minutes.

0915 US Industrial Production m/m (-1.0% expected) - This small number has gained additional focus lately as people accept the bottom but look for concrete signs there is a good foundation underneath it in the overall economy.
If it comes out at -0.4% or higher, EUR/JPY should rally 40-50 pips in 20 minutes.
If it comes out at -1.6% or lower, EUR/JPY should sell off 40-50 pips in 20 minutes.