Week of September 1, 2009

EURUSD’s broad outlook remains within a 1.3745-1.4446 consolidation zone as a sustained break of this zone will see further price extension in the direction of the break.  A daily close above 1.4446 will see prices continue to move higher initially targeting 1.4620 while to the downside a daily close below 1.3745 will see prices continue to move lower initially targeting 1.3664.  The medium term rise from the April 22, 2009 low of 1.2885 remains active as ONLY a daily open and close below 1.3850 will complete this rise while the August 5, 2009 high of 1.4446 holds.  As to the corrective fall from the August 5, 2009 high of 1.4446, this fall is complete at the August 17, 2009 low of 1.4045, as a daily open and close above 1.4251 will see further price extension to the upside with 1.4351 followed by 1.4446 as the objective.

GBPUSD’s broad outlook remains in a broad consolidation phase within a 1.6043-1.7042 consolidation zone. A sustained break of this zone will see further price extension in the direction of the break with a daily open and close above 1.6990 favoring further price extension to the upside with 1.7614 as the objective, while to the downside, a daily open and close below 1.6043 favors further price extension to the downside with 1.5719 as the initial objective.  As to the medium term rise from the April 22, 2009 low of 1.4396, this wave remains active as ONLY a daily open and close below 1.6031 will complete this rise while the August  5, 2009 high of 1.7042 holds.  Short term, the corrective wave from 1.7042 remains active as ONLY a daily open and close above 1.6491 will complete this fall while the August 27, 2009 low of 1.6151 holds, as prices will then continue to move higher within a 1.6491-1.6702 consolidation zone before another attempt to the downside.