Forex4you Technical Analysis 05 July 2011

EUR/USD: Technical Analysis

The bulls failed to recommence their growth and rise above 1.4560/70 resistance level, so trading reversed to a down trend and the price is now consolidating at 1.4470/60 levels. This recent pullback downwards indicates a wider correction range, which is very likely to expand to 1.4430/40 support. Indicators have turned to bearish, which now gives enough grounds to consider a real possibility for the reversal. On the other hand, the fact that SS is currently being overbought means that the bulls still have some potential to recommence their trend.  Previous forecasts, predicting growth to targets 1.4600/20, 1.4700 are still relevant. However, further bearish development is also quite a possibility. The signals for reversal are the same - decline below 1.4430/40 support line and then fixation below 1.4330/40 level.

GBP/USD: Technical analysis

The price keeps on moving downwards, trading is already being carried out below 1.6050/40 level.  1.6050/40 support breakout, if happens,  would indicate the bearish chances to win back their trend. Indicators suggest a decline as well, so there's even more possibility that the price falls to a local minimum at 1.5940/20. To confirm this forecast, however, the price has to first go back to a short-term downtrend channel (blue lines). As for now, we expect further growth to 1.6220/30 resistance line, and then to level 1.6320.

Analysis by: Arkady Nagiev    

                    Forex4you analyst

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