ForexPros Daily Analysis January 03, 2011
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The euro and pound suspiciously look to have fallen into the holiday reversal trap, where prices are pushed against the trend in lower volumes to allow for better entries into the wider trend. As such, both the euro and the pound tapped their greater 50% shorts and are currently reacting to them and dropping nicely.
The euro looks to have created a range between its full half way back from June at 1.30742 and its 50% short at 1.33777 (1.343 acting as strong resistance.) The greater trend is still short, with 1.347 being the line in the sand.
The pound continues in its orderly measured moves short and has reacted off its next short at 1.56273, with a target at 1.52104. Next major support is at the half way back from May at 1.52622.
Yen ( USD/JPY):
On the daily, still in extension short from 84.592 and has been moving steadily towards its target of 78.227, which would be an all time low. Next major level of support is previous low of 80.234.
Forex Trading analysis written by Diana Rochford for Forexpros.
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