Monthly Overview: February 2011 - for 12 pairs

EURUSD

The Euro-Dollar had another correction month in January and is still inside a symmetrical triangle, having bounced from the monthly SMA100 and Fibonacci 50% retracement on previous swing high, and reaching the middle line of the Bollinger Bands which is nearing a confluence with the SMA34 (middle point between both lines would be 1.3750 approximatively). The outlook for this pair is still bearish on the much longer term, with expectations towards last lows at around 1.2000/1.1900 for another retest of the monthly SMA200.

 

 

 

 

 

 

GBPUSD

Monthly overview for the Pound-Dollar looks slightly bullish with a confirmed bullish pin-bar from December, higher lows and a strong rejection at the 38% Fibonacci retracement. A retest of the highs and break to the upside towards SMA200 at 1.6600/1.6620 would be expected, with further continuation on the longer term towards upper Bollinger Bands at 1.7100/1.7170 provided SMA34 level and 1.6300 are clearly broken at the top of the present symmetrical triangle.

 

 

 

 

 

 

EURGBP

The Euro-Pound is also forming a symmetrical triangle on monthly charts, closing January barely at the SMA34 level with an inside doji / pin bar. Outlook on the longer term is bullish as it would seem the retracement from 2008 highs is over. In my opinion this pair is headed towards a retest of the highs at around 0.8940, with further target levels at 0.9120, 0.9340 and continuing its direction towards the all-time sought parity after a retest of the highs at around 0.9800.

 

 

 

 

 

 

 

EURCHF

January saw a strong rejection of the 1.2420 level for this pair, with a tweezer bottom pattern and expectations for a 50% to 61.8% Fibonacci retracement at levels 1.3120/1.3280, at the upper line of the falling wedge it is trading in, on the Monthly charts. A longer term overview could see a break of the upper line towards the middle line of the Bollinger Bands, at around 1.4100/1.4150.

 

 

 

 

 

 

 

 

 

GBPCHF

January retraced almost all of December fall, ending the month at about 50%. I would expect a bullish continuation for the long term, aiming to reach the upper line of the descending wedge it is forming on the monthly charts, coinciding with a 50% or 61.8% Fibonacci retracement on the previous swing low, and the middle line of the Bollinger Bands presently at about 1.6700.

 

 

 

 

 

 

 

 

 

USDCHF

The Swissie ended January with a hammer candle and 0.9300 could indeed be signaling a momentary bottom for this pair. Retracement to 1.0200 or 1.0500 level is still on the lines (near Fibonacci 38.2% and 50%) but a failure to execute the reversal would bring us further down to a 127% Fibonacci extension at around 0.8640/0.8600.

 

 

 

 

 

 

 

 

 

USDJPY

I still see bearish potential for this pair on the long term, despite the fact that monthly charts show a descending wedge and we could be reaching a bottom temporarily. My views are for a further fall to around 75.00 but it is quite possible that we will see first a retracement to 86.00 (38.2% Fibonacci) or 87.70 (50%) over the last leg down.

 

 

 

 

 

 

 

 

 

EURJPY

Still in a consolidation mode, long term overview for this pair can bring us further down to around 95.00 with a break of the lower line of the descending wedge. However, and as for USDJPY, I expect a previous retracement to the 118.00/20 resistance area and middle line of the Bollinger Bands before a continuation of the bearish move.

 

 

 

 

 

 

 

 

 

GBPJPY

A retracement to 160.00/164.00 is possible for this pair over the long term, but I would conservatively aim for a pull back to psychological levels 140.00 as first target and 150.00 on a second step, due to the extended bearish tone of the move. I would expect further ranging between 130.00 and 140.00 levels for a while.

 

 

 

 

 

 

 

 

 

 

USDCAD

The Loonie ended January sitting just above parity, however there is still room to the downside and the pair could attempt to revisit October 2007 lows at around 0.9060 over a longer period. By now, first level of support that I would take into account would be 0.9580/0.9500 in a continuation of its bearish move.

 

 

 

 

 

 

 

 

 

AUDUSD

The Aussie looks still bullish despite its January correction, and could continue to the upside attempting to break the previous December highs. However I would favor a deeper correction to a 38.2% or even 50% Fibonacci retracements, targeting support levels at 0.9460 and 0.9200, before its continuation of the strong bullish trend.

 

 

 

 

 

 

 

 

 

XAUUSD (GOLD)

Gold realized a deep correction in January, almost reaching the 38.2% Fibonacci retracement level. We maintain our expectations for a continuation of this correction at least to the 50% at 1240.00.