Forex Market Technical Analysis

December 19, 2007

EURUSD

EURUSD's down trend remains and the fall from 1.4966 extended to as low as 1.4331. Further decline towards 1.4000 area is expected. Near term resistance is at the down trend line from 1.4966 to 1.4750, now at 1.4670, as long as the trend line resistance holds, we'd expect down trend to continue. For long term analysis, the pair formed a long term cycle top at 1.4966 on weekly chart. Down trend is expected to follow, long term target would be at 1.2950, followed by 1.2150.

GBPUSD

GBPUSD is testing the long term support at 2.0100, break below this level will confirm the long term down trend, and further fall towards 1.9800 area is expected to follow. Near term resistance is still at the down trend line, and as long as the trend line resistance holds, we'd expect down trend to continue. For long term analysis, the pair formed a long term cycle top at 2.1161 on weekly chart. Further fall towards 1.8000 is expected.

AUDUSD

No changed in our view, AUDUSD is in down trend. Further fall towards 0.8400 area to reach the next cycle bottom is expected. Key resistance is at 0.8918, and as long as the pair stays below this resistance, we'd expect down trend to continue. For long term analysis, AUDUSD is in consolidation to the long term up trend, Rise towards 1.0000 to reach the next cycle top on weekly chart is still possible after consolidation.

USDJPY

USDJPY is in up trend. Further rise to test the resistance at the down trend line from 123.66 to 117.93 is possible in a couple of days, if this resistance gives way, further rally towards 117.00 area can be seen. Key support is at 110.49, only fall below this level will signal the reversal to the up trend. For long term analysis, the pair may be forming a long term cycle bottom at 107.21 on weekly chart, further rally towards 124.13 (June 22 high) is expected.

USDCHF

USDCHF is in up trend. The rise from 1.0890 extended to as high as 1.1573, and further rally towards 1.1800 area is still possible after slightly consolidation. Key support is now at 1.1153, only break below this level would signal the reversal to the up trend. For long term analysis, the pair may be forming a long term cycle bottom at 1.0890 on weekly chart, key resistance is at 1.1891, a break above this level will confirm the cycle bottom, and further rise towards 1.2900 area may be expected.

USDCAD

USDCAD might be forming a cycle top at 1.0248 on daily chart, key support is at 1.0004, a break below this level will confirm the cycle top, and pullback towards 0.9400 area can be seen. Near term resistance is at 1.0248, only break of this level will signal the resumption of the up trend. For long term analysis, the pair formed a cycle bottom at 0.9056 on weekly chart. Consolidation in a range between 0.9056 and 1.0750 can be seen in the next several months.

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