Daily Forex Analysis – January 14, 2010

USDCAD Analysis.
Being contained by the falling trend line from 1.0745 to 1.0576, USDCAD dropped again from 1.0413, suggesting that a short term cycle top has been formed on 4-hour chart. Now the fall from 1.0413 is treated as resumption of downtrend from 1.0745. Another fall towards 1.0206 (Oct 15 low) is now in favor. Resistance remains at the falling trend line, followed by 1.0413, only rise above this level could indicate that the fall from 1.0745 has completed.

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AUDUSD Analysis.
After touching the rising trend line on 4-hour chart, AUDUSD is expected to move sideways without trend in a range between 0.9123 and 0.9325. As long as 0.9123 support holds, the price action from 0.9325 is treated as consolidation of uptrend, and one more rise towards 0.9404 (Nov 16, 2009 high) is still possible. However, a break below 0.9123 will indicate that the rise from 0.8734 has completed, then deeper decline could be seen to 0.9000 or even 0.8850.

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EURUSD Analysis.
EURUSD’s bounce from 1.4266 extends further to as high as 1.4579. One more rise to 1.4600-1.4650 area to reach the next cycle top on 4-hour chart is still possible later today. Key support is now located at 1.4454, a breakdown below this level will indicate that a short term cycle top has been formed and another fall is expected to re-test 1.4218 previous low support.

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USDJPY Analysis.
USDJPY is in downtrend from 93.75. Another fall is still possible to the bottom of the rising price channel on 4-hour chart later today. However, the fall from 93.75 is more likely correction of uptrend from 84.82 (Nov 27, 2009 low), one more rise towards 95.00 could be expected after correction.

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GBPUSD Analysis.
GBPUSD broke above 1.6238 resistance, suggesting that the downtrend from 1.6875 (Nov 16, 2009 high) has terminated at 1.5829 level already. The pair is now in uptrend. Further rally is expected in a couple of days. Next target would be at 1.6400-1.6450 area. Support is at 1.6200, as long as this level holds, uptrend from 1.5896 will continue.

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USDCHF Analysis.
USDCHF might be forming a short term cycle bottom at 1.0132 level on 4-hour chart. Key resistance is now located at 1.0218, a break above this level will confirm the cycle bottom and signal further rally towards the upper border of the falling price channel. Support is located at 1.0132, only fall below this level could indicate that the fall from 1.0507 has resumed, then another decline could be seen to 1.0050-1.0100 area.

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