Weekly Technicals 28th Jan – 2nd Feb 2013

Supports – 1.3375 1.3300 1.3150
Resistances – 1.3500 1.3550 1.3650
Price range: 1.3300 – 1.3550
Trading call

EURO bounced off the lows against the greenback, to rally more than 1%, week- on- week to register a close at 14- months high. The currency pair picked up steam during the second half of the week after beginning the week on a very sedate note but managed to hold above to the previous week’s lows at $1.3256 and important supports at $1.3150- 1.3175.

Expecting the rally to continue to $1.3500- 1.3550 in the near- term; top end of the near- term bullish channel and $1.3650 in the medium term.

The trend remains bullish with the breakout of the ascending triangle chart pattern at $1.3175 for a profit target of $1.3660 intact

Short and long- term trend – Bullish
Medium- term trend – Topped out
Long EURO-

At $1.3375 with a stop at $1.3330 for a profit target of $1.3475.
At $1.3300 with a stop at $1.3250 for a profit target of $1.3475.
Short EURO-
At $1.3550 with a stop at $1.3600 for a profit target of $1.3400.

Supports – 1.5790 1.5666 1.5600
Resistances – 1.5830 1.5900 1.6025
Price range – 1.5600 – 1.5830
Trading call-

Pound sterling extended its losses versus the US dollar to end the week lower by 0.41%, extending its losses for the second successive week.

Sterling also ended the week closing at a 5- month low versus the US dollar and the currency pair continues to remain bearish after failing to close above $1.5830.

Close above $1.5830, Sterling could rally to $1.5900- 1.6025, but the trend will revert to bullishness ONLY if the pair closes above $1.6000- 1.6025 for targets of 1.6200 followed by $1.6350.

However, in the near- term, expect the pair to slide further and hit the lower end of the near- term bearish channel at $1.5600.

Short and long term trend- Bearish
Medium term trend- Bullish

Hold on to short Sterling positions initiated at 1.5775 with a stop loss at 1. 5840 for a profit target of 1.5650.
Long Sterling-
At 1.5600 with a stop loss at 1. 5540 for a profit target of 1.5775.
At 1.5870 with a stop loss at 1. 5820 for a profit target of 1.5950.

Supports – 89.50 88.75 87.75
Resistances – 91.50 94.75 95.25
Price range – 88.75 – 91.50
Trading call-

The greenback ended the week with gains of 0.94% versus the yen, marking the eleventh successive week of positive closes, not witnessed in many decades. The currency pair closed at a new 30- month high and has gained more than 18% from the lows since September 2012.
The pair was highly volatile and briefly broke mid and long- term supports at ¥89.50 and ¥88.75 correspondingly, but bounced off the lower end of the near- term bullish channel at ¥88.00.

The pair is holding at ¥91.25; very close the top- end of the near- term bullish channel at ¥91.50. Close above and the greenback could rally to ¥95.00 very quickly.

However, expecting the pair to correct from current levels and trade in the ¥88.75- 91.50 range for the week.

Near term trend- Topping out; Medium term trend- Bullish; Long term trend- Bearish
Hold on to Short USD/JPY positions initiated at 90.90 with a stop loss at 91.75 for a profit target of 89.00.
Long USD/JPY-
At 92.25 with a stop loss at 91.25 for a profit target of 94.50.