EUR/USD's recovery attempt was limited by 4 hours 55 EMA and recent decline extended to as low as 1.2630 last week. Initial bias remains on the downside this week and current fall should target 100% projection of 1.4939 to 1.3145 from 1.4246 at 1.2452 next. On the upside, break of 1.2878 resistance is needed to signal short term bottoming.
USD/JPY spiraled back down to 76.66 last week but was contained above 76.57/60 support and recovered. Initial bias remains neutral this week first. Above 77.03 will bring stronger rise back to 77.33 resistance. Break there will revive the case of near term bottoming and target a test on 78.22 resistance. On the downside, however, break of 76.
GBP/USD dropped further to as low as 1.5234 last week and the break of 1.5271 support confirmed that whole decline from 1.6746 has resumed. Initial bias remains on the downside this week and current fall should target 100% projection of 1.6618 to 1.5271 from 1.6165 at 1.4818 next. On the upside, above 1.5408 minor resistance will turn bias neutral and bring consolidations.
The strong rebound from near term falling trend line argues that USD/CHF's pull back from 0.9594 has already completed at 0.9406 last week. Initial bias is mildly on the upside this week for 0.9594 first. Break will confirm resumption of whole rally from 0.7065 and should target 0.9916 key resistance next. On the downside, below 0.
AUD/USD's rally attempt was limited below 1.0385 resistance last week. Initial bias remains neutral this week and more sideway trading could be seen. But after all, with 1.0148 support intact, further rally is still mildly in favor. Above 1.0385 will extend the rise from 0.9663 to upper trend line resistance (now at 1.0483) first. Though, break of 1.
USD/CAD continued to gyrate inside converging range last week as triangle consolidation from 1.0656 extended. Outlook remains unchanged. Firstly, as long as 1.0051 support holds, we'd favor an eventual upside breakout. But secondly, break of 1.0422 is needed to be the first signal of breakout and target a test on 1.0656 high.
GBP/JPY dropped to as low as 117.29 last week as fall from 127.30 continued. Initial bias remains on the downside this week for 116.83 key support level next. Break there will confirm resumption of larger down trend. On the upside, break of 119.11 resistance is needed to signal short term bottoming. Otherwise, near term outlook will remain bearish even in cas of recovery.
EUR/JPY recovered to 98.80 last week but upside was limited by 4 hours 55 EMA and the cross then dipped sharply. The break of 97.27 support in the end suggests that recent fall is resuming. Initial bias is on the downside this week for 61.8% projection of 102.53 to 97.27 from 98.80 at 95.54 next. On the upside, break of 98.80 resistance is needed to signal short term bottoming.
EUR/GBP formed a short term bottom at 0.8221 last week and rebounded strongly to as high as 0.8376 before paring much of the gains. More consolidations could be seen above 0.8221 in near term and another recovery cannot be ruled out. But strong resistance should be seen from 38.2^*1 retracement of 0.8830 to 0.8221 at 0.8454 to limit upside and bring fall resumption eventually. Below 0.
French President Nicolas Sarkozy on Sunday said that he would announce more reforms to overcome the debt crisis, according to reports.
France lost its coveted triple-A rating as rating agency Standard and Poor's downgraded the country's rating on Friday along with other eight euro members.
Sarkozy said that he will announce some important decisions at the end of the month that could lead the country out of the crisis. He urged the French public to have courage and maintain calm to make difficult decisions to stave off the crisis.
The rating action was a severe blow to Sarkozy's efforts to keep the debt crisis at bay as France prepares for Presidential elections this Spring.
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