Published: Jan. 06 2005, 07:36 GMT
JPY retraces in quiet session

Asian Session relatively calm today as JPY consolidates some of yesterday’s gains against the USD and EUR. European Confidence data today likely to be uninspiring.





MAJOR HEADLINES – PREVIOUS SESSION



JPY retraces some of yesterday’s gains in a relatively subdued Asian Session.

USD ranging back to stronger end of the range against most currencies in late Asian session.

EUR/JPY testing and USD/JPY testing resistance as we head into European session.















THEMES TO WATCH – UPCOMING SESSION

European confidence data may be somewhat in focus – this data is released at 10:00 GMT-

USD may head to weaker end of the range as the market could look to take its breath before Friday’s important US employment data.



Trading Note: If the markets want to take the Friday nonfarm payrolls seriously (something they haven’t really done the last couple of times around as markets were more concerned with the central bank reserve situation), then it seems like we could see a reasonable-size pullback to the weaker end of the EUR range.The JPY may strengthen again.







EURUSD

EURUSD could find support at the 1.3250 area today and may head higher and even break 1.3300 area resistance. The maximum topside for now would seem to be around 1.3350, however, as EURUSD may head lower toward 1.3100 further out.



[font='trebuchet ms', arial, sans-serif]Resist.

1.3439



1.3350



1.3232



1.3172



1.3083

Support
[/font]






GBPUSD

GBPUSD eased well back toward 1.8800 support. The pair could rally a bit today if the market sees a round of USD weakness ahead of tomorrow’s employment data. The maximum potential upside for now would seem to be around 1.8940. Resistance may materialize soon as this pair looks like it may head to 1.8650 or lower further out.



[font='trebuchet ms', arial, sans-serif]Resist.1.9072

1.8947



1.8792



1.8697



1.8572

Support
[/font]






USDJPY

USDJPY found strong resistance yesterday. 104.30 is minor resistance and 104.75 a more important resistance level. A break of the latter could see USDJPY to 105.75. A fall through 103.25, however, could jeopardize the whole rally potential of this pair.

[font='trebuchet ms', arial, sans-serif]Resist.106.82

105.57



104.56



103.07



101.82

Support
[/font]






EURJPY

EURJPY fell all the way to the recent lows just below 138.00, but managed to find support there and has headed higher to 138.30 minor resistance. The pair could pull higher still to the higher resistance at 139.00, but the chart remains distinctly bearish and EURJPY may head quickly to 137.00 and then 135.00 further out.

[font='trebuchet ms', arial, sans-serif]Resist.140.58

139.43



138.34



137.13



135.98

Support
[/font]






USDCAD

USDCAD remains in a small range after an apparently premature break of 1.2300 yesterday. The pair may head to lower support around 1.2160 if 1.2275 resistance hold. Further out, however, the upside may continue to at least 1.2400.

[font='trebuchet ms', arial, sans-serif]Resist.1.2514

1.2388



1.2267



1.2135



1.2009

Support
[/font]






USDCHF

USDCHF still has a chance at a try at lower support around 1.1600 if 1.1710 resistance holds. Further out, however, USDCHF may have a go at news highs toward 1.1940.

[font='trebuchet ms', arial, sans-serif]Resist.1.1918

1.1807



1.1716



1.1584



1.1472

Support
[/font]






AUDUSD

AUDUSD is testing the lower end of the range. If 0.7600 doesn’t hold, then the pair may head straight to 0.7550. The preferred scenario, however, is for AUDUSD to hold and for it to test a bit higher toward 0.7700 resistance before resuming the downside. The major downside target further out remains at 0.7360.

[font='trebuchet ms', arial, sans-serif]Resist.0.7848

0.7749



0.7617



0.7551



0.7452

Support
[/font]






NZDUSD

The NZDUSD chart remains bearish, though a rally back toward the 0.7050 area may be in the cards before we see a resumption of the downside toward 0.6850 and possibly beyond.

[font='trebuchet ms', arial, sans-serif]Resist.0.7265

0.7139



0.6987



0.6887



0.6761

Support
[/font]




The support/resistance levels used in the matrix’s of this document are levels derived from yesterday high, low and close. Reference in the text to other support/resistance levels will occur.