September 17th, 2008

EURUSD continies to consolidate the recent 1.3882-1.4479 corrective rise as prices have essentially remained within a 1.4100-1.4380 consolidation zone. To the upside, a sustained move above 1.4251 will suggest further upside potential with 1.4395 as the next objective, while to the downside, a sustained move below 1.4100 suggests favors further downside potential towards 1.4023, with a 1 hour open and close below seeing further extension towards 1.3882. As menetioned in Monday’s update, short term fall from the August 21 high at 1.4909 is complete with the September 11, 2008 low at 1.3882, as further consolidation is expected in the session ahead. As to the medium term fall from the July 15, 2008 high at 1.6037, only a daily open and close above 1.4705 will complete this fall while 1.3882 holds, as prices will then trade within a 1.4705-1.5214 consolidation zone before attempting a more dramatic move to the downside targeting 1.3054 in the weeks ahead.

Similarly, GBPUSD continues to consolidate the 1.7444-1.8128 corrective rise as a sustained move above 1.7867 suggest further upside potential towards 1.7967 while to the downside a sustained move below 1.7705 favors further downside towards 1.7615. As to the medium term fall from the July 15, 2008 high at 2.0155, only a daily open and close above 1.8480 will complete this fall while 1.7444 holds, as prices will then trade within a 1.8480-1.9119 consolidation zone before another attempt to the downside targeting 1.7058 in the weeks ahead.

Intra day, USD is witnessing broad selling but any USD weakness should be viewed as opportunities to buy USD against the European and commodity currencies, as the trend remains for continued US dollar gains into the weeks ahead.

More updtes later.

Forex Signals Plus, RW

Intra day, prices suggest