Ending the day in negative territory, investors are not yet ready to trust the common currency, as despite Merkel and Sarkozy agreed on several reforms to the EU Treaty that should be ratified in March 2012, to resolve the debt crisis, S&P Rating agency put 15 members of the area in negative watch. The common currency gave up all the ground gained Monday, entering Asian session just below 1.3400 area and with hourly chart showing an increasing bearish momentum. Price develops below 20 SMA while RSI is flat below 50 in the mentioned time frame, supporting the negative bias. In the 4 hours chart, the bearish momentum is also developing with indicators heading south below their midlines. Key support, is now past Friday’s low at 1.3360, as once below, the sell off will likely accelerate.
Support levels: 1.3360 1.3320 1.3280
Resistance levels: 1.3440 1.3480 1.3530
Pound managed to post some gains against greenback, reaching 1.5710 Fibonacci area, as per being the 38.2% retracement of the 1.6165/1.5422 rally, before retreating back below 1.5660, immediate resistance zone. Hourly cart shows price struggling around 20 SMA while indicators gain the downside, supporting more slides once below 1.5620 next support. In the 4 hours chart, momentum indicators retreats after testing 100, supporting the view, and favoring the downside for the upcoming sessions.
Support levels: 1.5620 1.5570 1.5520
Resistance levels: 1.5660 1.5710 1.5745
The USD/JPY broke the short term ascendant channel that drove the pair higher over the last few days, although trades in a limited range and still above 77.70 price zone. Hourly chart shows indicators below their midlines, and price below 20 SMA while in the 4 hours chart, the bearish tone is not yet present, as per candles showing long lower shadows that suggest some increasing buying interest.
Support levels: 77.70 77.50 77.25
Resistance levels: 78.05 78.25 78.40
Australian dollar continues in an horizontal channel in between Fibonacci levels, having traded in the middle most of this Monday, still lacking clear directions; hourly chart shows a very limited bearish tone coming as per indicators heading slightly lower still above their midlines, while price aims to break below 20 SMA. In the 4 hours chart, picture is quite the same, as per indicators almost horizontal. The extremes of the range are located at 1.0330 and 1.0190: expect no clear trend unless a break of any of both.
Support levels: 1.0230 1.0190 1.0145
Resistance levels: 1.0270 1.0300 1.0330
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