Daily Forex Analysis - February 20, 2009

GBPUSD Analysis.
Being supported by 1.4051, GBPUSD rebounds from 1.4093 level, suggesting that the range trading between 1.4051 and 1.4606 is underway. However, the price action from 1.4134 is more likely consolidation of the short term downtrend from 1.4985. As long as 1.4606 resistance holds, deeper decline is still possible to 1.3750 zone, and a break down below 1.4051 key support will confirm the resumption of the short term downtrend.

AUDUSD Analysis.
Being contained by the key resistance at 0.6529, AUDUSD pulls back from 0.6521 level. The pair might be forming a short term cycle top at this level, key support is located at 0.6331, a break below this level will confirm the cycle top and then deeper decline could be seen to retest 0.6248 previous low support. However, above 0.6529 key resistance will indicate that the fall from 0.6849 has completed and further rally is expected to 0.6700-50 area.

EURUSD Analysis.
EURUSD remains in short term downtrend from 1.3093. The rise from 1.2512 is treated as consolidation of the downtrend. Deeper decline is still possible to 1.2400 zone after consolidation. Near term resistance is now at 1.2760, only rise above this level will indicate that a short term cycle bottom has been formed at 1.2512 level, and then further rebound could be seen to 1.2850-900 area.

USDCAD Analysis.
USDCAD is in short term uptrend from 1.2130. The pullback from 1.2672 is more likely consolidation of the uptrend. Near term support is now at 1.2466, as long as this level holds, we’d expect one more rise to test 1.2765 previous high resistance. Only fall below 1.2466 will indicate that the rise from 1.2130 has completed, and deeper decline could be seen to 1.2300 zone.

USDJPY Analysis.
USDJPY is testing the key resistance at 94.61, a break above this level will indicate that the downtrend from from 110.66 (Aug 15, 2008 high) has terminated, and the following medium term uptrend will bring price to 100.00 area. Initial support is now at 93.29, only fall below this level will signal consolidation of the uptrend from 87.12.

USDCHF Analysis.
No changed in our view, USDCHF stays in the rising price channel on 4-hour chart. Further rally is expected to 1.2000 zone in next several days. Initial support is now at 1.1650, only fall below this level will signal deeper decline to test the support of the lower border of the price channel.