(Price on 1st pane, Slow Stochastics on 2nd pane; uptrend line in green; downtrend line in red; horizontal support/resistance level in yellow; Fibonacci retracement levels in grey; 50-period simple moving average in light blue.)

10/31/2008 – EUR/USD – Price action on the EUR/USD daily chart, as shown, has clearly been rejected at the resistance imposed by a key 38.2% Fibonacci retracement level and an important prior support/resistance level around the 1.3250-1.3300 region. This price rejection, which was manifested as a clear shooting star candle, occurs within the context of an important upside correction within the overall downtrend in the pair.

Oscillator momentum is still to the upside, but price currently appears to be targeting eventual major support at the level of the 2 ½ year low around 1.2330. Any break below 1.2450 would confirm these potentially bearish intents. A bullish break above 1.2850, on the other hand, could signal a potential subsequent rise to retest the 1.3250 resistance.

James Chen

Chief Technical Analyst, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

*IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors. Click here for more information.

(Price on 1st pane, Slow Stochastics on 2nd pane; uptrend line in green; horizontal support/resistance level in yellow; Fibonacci retracement levels in grey; 50-period simple moving average in light blue.)

10/30/2008 – AUD/JPY – After plummeting an unprecedented amount in the last three months, price action on the AUD/JPY carry-traded pair (a daily chart of which is shown) has rebounded a substantial amount of pips off its historical lows around 55.00. This has occurred after a massive carry trade unwinding that shook out even the most determined yield-seekers.

The current rebound has taken price all the way up to a key 38.2% Fibonacci retracement level (the high-to-low retracement span being measured from the swing high on 9/22/2008 to the historical low reached on 10/24/2008) before retreating. Oscillators like the displayed Stochastics are still showing unspent upward momentum, as they are pointing unmistakably up after having just emerged from oversold.

Any continued upside momentum that breaks out above the aforementioned 38.2% Fib level could eventually target strong resistance that resides all the way up in the 72.00 region. Significant support to the downside, on the other hand, resides around the 63.00 level, a prior support region.

James Chen

Chief Technical Analyst, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

*IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors. Click here for more information.

(Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; downtrend lines in red; horizontal support/resistance levels in yellow; Fibonacci retracements in grey; 50-period simple moving average in light blue.)

10/29/2008 –GBP/USD – Price action on GBP/USD, a daily chart of which is shown, has rebounded in a major way for the last couple of days. Among other catalysts of this rebound, traders’ expectations of potential dollar weakening as a result of an expected FOMC rate cut on Wednesday contributed to the major bullish push.

After double-testing a low extreme at around 1.5265-75, price has formed two long, bullish bars in its quest to climb back up as of mid-session in New York on Wednesday. Momentum appears clearly to the upside as oscillators like the displayed Stochastics, which are just emerging up from oversold, are also supporting a bullish outlook.

Currently, price is approaching a critical juncture. This juncture combines a key 38.2% Fibonacci retracement level (the high-to-low retracement span being measured from the swing high on 9/25/2008 to the extreme swing low on 10/24/2008) with a significant prior support/resistance level around the 1.6550 region. In the event of a strong break above this level, price could target further resistance around the 1.6800 region, a key prior support area and the bottom of the previous triangle. Further major resistance above that resides around the 1.7000 area, an important psychological level and the 50% Fibonacci retracement.

James Chen

Chief Technical Analyst, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

*IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors. Click here for more information.

(Price on 1st pane, Slow Stochastics on 2nd pane; uptrend lines in green; downtrend lines in red; horizontal support/resistance levels in yellow; Fibonacci retracement levels in grey; 50-period simple moving average in light blue.)

10/28/2008 – USD/JPY – After a remarkable plunge last week in the USD/JPY, a daily chart of which is shown, price action has finally made a major rebound during overnight trading as of Tuesday morning in New York.

Due to widely reported possibilities for Japanese yen intervention as well as a substantial rebound in the Nikkei Index, which contributed to a lowering of risk aversion, this significant rebound could possibly represent the beginnings of a bottom reversal in this key pair. Or it could just be an important correction within the context of a continuing overall downtrend.

At this point it is too early to tell, but traders can look towards significant support/resistance levels for guidance on potential direction. Today’s rebound reached and retreated from a 38.2% Fibonacci retracement level, which coincides approximately with a significant prior swing low (in mid-March). If price continues its retreat, clear support to the downside resides around 90.90, the level of the recent historical low. Any continuation of the current upward correction with a strong break above the 38.2% level, on the other hand, should target the 98.50 prior support region, which coincides with the 61.8% Fibonacci retracement level.

James Chen

Chief Technical Analyst, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

*IMPORTANT NOTICE: These comments are for information purposes only. The information contained on this document does not constitute a solicitation to buy or sell by FX Solutions, LLC., and/or its affiliates, and is not to be available to individuals in a jurisdiction where such availability would be contrary to local regulation or law. Opinions, market data, and recommendations are subject to change at any time. Forex trading involves substantial risk of loss and is not suitable for all investors. Click here for more information.