Daily Forex Analysis – October 23, 2009

USDCHF Analysis.
USDCHF stays below the falling trend line on 4-hour chart and remains in downtrend from 1.0452. As long as the trend line resistance holds, we’d expect downtrend to continue and deeper decline towards 0.9950-1.0000 area would more likely be seen later today. However, a clear break above the falling trend line will suggest that a short term cycle bottom has been formed and the downtrend from 1.0452 has completed already, then the following uptrend could take price back to 1.0300 zone.


EURUSD Analysis.
EURUSD remains in a bullish movement from 1.4484. Another rise towards 1.5100 is still possible later today. Support is at the bottom of the rising price channel on 4-hour chart now at 1.4940, and key support is now located at 1.4882, a breakdown below this level will indicate that the upward trend from 1.4484 has completed, then the following pullback could take price to 1.4700-1.4750 area.


USDJPY Analysis.
USDJPY broke above 91.31 resistance, and the uptrend from 88.01 extended further to as high as 91.70 level. Another rise to 92.00-92.50 area is now in favor. Initial support is at 91.10, as long as this level holds, the short term uptrend from 90.07 will continue. However, below 91.10 level will signal another pullback to retest the support of the rising trend line from 88.01 to 88.83. The key support is located at the rising trend line now at 90.00, a clear break below this level will take price back 88.50 zone.


USDCAD Analysis.
No changed in our view, USDCAD might be forming a short term cycle top at 1.0584 level on 4-hour chart. Consolidation in a range between 1.0206 and 1.0584 is expected in next several days, and move to 1.0250-1.0300 area would more likely be seen later today. Resistance level is at 1.0584, only rise above this level will suggest the the uptrend from 1.0206 has resumed, then another rise towards the upper border of the falling price channel could be seen to follow.


AUDUSD Analysis.
AUDUSD remains in upward trend from 0.8567 and the price action from 0.9269 is treated as consolidation of uptrend. Further rise is still in favor later today and target would be at 0.9400 zone. Key support is at 0.9112, only fall below this level will indicate that the rise from 0.8567 has completed.


GBPUSD Analysis.
GBPUSD continues its short bullish trend from 1.5708 and the rise extends further to as high as 1.6677 level so far. As long as 1.6486 support holds, we would expect uptrend to continue and move higher to test 1.6741 long term key resistance is in favor later today, a breakout of this level will indicate that the longer term downtrend started from 1.0742 (Aug 5 high) has completed at 1.5708 level already. However, a minor consolidation could be expected before breaking above 1.6741 resistance.


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