Market Commentary Monday 24 August 2009

EUR/USD closed higher on Friday as it extends this week's rally. The high-range close sets the stage for a steady to higher opening on Monday. Today's close above last Thursday's high crossing tempers the bearish outlook in the market. Stochastics and the RSI a bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, the reaction high crossing is the next upside target. Closes below Monday's low crossing would confirm that an important top has been posted.

USD/JPY closed lower on Friday due to light profit taking as it consolidated some of this month's rally. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are overbought but remain neutral to bullish signalling that sideways to higher prices are possible near-term. If it extends this month's rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted.

GBP/USD closed lower on Friday as it consolidates below the 20-day moving average crossing. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing would temper the near-term bearish outlook in the market. If it extends this month's decline, July's low crossing is the next downside target.

USD/CHF closed higher on Friday as it extends this week's rally. The high-range close sets the stage for a steady to higher opening on Monday. Today's close above last Thursday's high crossing tempers the bearish outlook in the market. Stochastics and the RSI a bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, the reaction high crossing is the next upside target. Closes below Monday's low crossing would confirm that an important top has been posted.

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