EUR/USD

Looking at the Euro, you can see that today saw it fail at the 1.38 handle yet again. This proves just how strong this resistance is. The move was reversed in the afternoon session of New York trading as Crude Oil prices spiked. The fundamental reasoning is that prices might finally start to scare the US consumer.

As the chart looks now, there is still a bullish bias, and the support at 1.3750 is just below. The recent hammer that found 1.37 as support will be key. If that gets broken below – we could see a continuation of the previous consolidation all the way down to 1.3450, and perhaps a break below would even lead to 1.3000 or worse. A daily close above the 1.38 handle opens the door to the 1.40 handle.

EUR/GBP

Over the last 4 months or so, we have been in consolidation in the EUR/GBP pair from the 0.8650 and 0.83 marks. As you see on the chart, there is also a minor support and resistance area at the 0.85 level.

Recently we have seen a shooting star on the daily, however it was in “no-man’s land” like we are in now. Looking at the candles, it must be said that this pair looks weak. The bias is certainly to the downside, and any break below 0.85 can lead to 0.83 very quickly. A break below that – and 0.80 is in the cards. Any supportive move should see a retest of the recent highs at 0.8650. It should be noted however, that the last high wasn’t as high as the one before it.

USD/CHF

This pair had been in consolidation between 0.98 and 0.93, but we had a breakdown a few days ago. You can see that the recent action has been a retest of the 0.93 handle, and the daily candle on Tuesday looks like a shooting star, signaling that we are going to retest the absolute all-time lows.

If we break above the candle for Tuesday, it is possible that we enter into the consolidation and make a run as high at 0.98 or so. However, any longs you take in this pair must have tight stops as that is the least likely of scenarios.

If we make new lows, the recent consolidation measures to be a 500 pip move, making a possible final target of 0.88 for this pair.