Emerging Markets are bouncing today with Turkish lira (TRY) and South African rand (ZAR) both up ove...
Pressure Continues on Euro and British Pound
11/18/2010 12:01 am EST
GBPUSD: Remains Vulnerable to the Downside
Despite its present recovery attempt, as long as the British Pound (GBP/USD) continues to trade below its broken rising trendline and the 1.5950 level, we remain nearer term bearish on the pair. This leaves the 1.5730 level as the next downside target where a loss will call for more weakness towards the 1.5648 level.
Below there should cause further bear threats. On the upside, a violation of the 1.6298 level is required to resume its medium term uptrend towards the 1.6456 level, its January 19, 2010 high and next, the 1.6875 level traded in on November 15, 20109.
All in all, GBP/USD remains broadly biased to the upside but faces further bear threats after violating its rising trendline on Tuesday.
EURUSD: Bear Pressure Continues to Dominate
Continued bear pressure remains dominant as the pair lost further ground on Tuesday to test a low of 1.3445. EUR’s present weakness is coming on the back of a loss of upside momentum at 1.4281. Immediate support lies at its .50. Fib Ret (1.5143-1.1875 decline) at 1.3500.
Further support lies at the 1.3332 level. However, a convincing break and hold above the 1.3696 level is required to halt its present losses and target further recovery towards the 1.4084 level, its November 08, 2010 high. Ultimately, a decisive break and close above the 1.4281 level traded in early November 2010 is required to resume its medium term uptrend towards its January 17, 2010 high at 1.4413.
Mohammed Isah can be found at FXTechStrategy.com.
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