GBP USD Technical Forex Analysis for Forex Traders

Dollar/Yen traded below the 84 level for a short while, then jumped to around 84.60 and consolidated above 84. This is probably just a short break, and once it is over, we expect the Yen’s strength to continue, and we believe we will see levels below 83.58 on the short term. We have noticed an ideal (Dark Cloud Cover) candle pattern on the daily chart (please refer to the attached chart), and this is a well known bearish pattern which promises more excitement as we drop lower & lower, especially after the BoJ disappointing the markets yesterday, and the “Japs” saying that they are “watching the currency movement closely”! The market has had it with such statements, the “japs” now will have to take a seat and watch the spectacular Yen show against the Dollar & the Euro. Short term support is at 84.11, if broken, we will be on the way to our long awaited target 82.50, and may be later we will test the psychological level 80.00, given enough time. On the other hand, it is hard now to imagine the Dollar beating the 84.88 resistance, But if it does, it will be violent in the face of those who believe in the Yen, and will shoot to 86.25 & may be 86.81.

Support:

• 84.11: the rising trend line from last week’s low on the hourly chart.

• 82.50: the trend line combining the monthly lows of Dec 08, Jan & Nov 09, on the weekly chart.

• 80.00: psychological level.

Resistance:

• 84.88: the falling trend line from Jun 4th top, a very important line.

• 86.25: Jul 16th low.

• 86.81: Jul 26th & 27th low.