Weekly Forecast (FX)

GBP/USD on 3-Jan-2011 (Mon)

Finally GBP/USD showed a bottom on 28-Dec-2010 at 1.5342.
Which is very close to a strong support level of 1.5330.  Refer to my posting on GBP/USD 25-Dec-2010.
Good to see GBP/USD rebounded to 1.56 region, and this is also 50% of the fibo retracement from previous top 1.5909 on 14-Dec-2010.
But, how high would GBP/USD go?

R3: 1.5800
R2: 1.5730
R1: 1.5630
S1: 1.5530
S2: 1.5430 (*all figures rounded to nearest 30, or multiple of 10)

My short on 1.5650 works just fine, but it came a bit too early, I guess there're still room for advancement to 1.5800 region.
Therefore, my short at 1.5650,  SL 1.5690, -40pips.  I am going to close this position when GBP/USD is trading at 1.5460, aim for 210 pips profit.

Day range for GBP/USD: 130 pips

EUR/USD on 3-Jan-2011 (Mon)

R3: 1.3750
R2: 1.3530
R1: 1.3430
S1: 1.3300
S2: 1.3250

I have 2 thoughts on EUR/USD:
1) This week, expect EUR/USD to trade in consolidation within the range of 1.3350-1.3100.
The high of 1.3423 on 31-Dec-2010 act as a resistance.

The low of 1.3053 on 23-Dec-2010 must not be breached, and act as a strong support.

2) If EUR/USD has break above the high of 1.3423, it is going to continue its bullishness until 1.3500, it must make a higher high within this week to confirm the reversal.  And lead us to new high in coming weeks, target 1.40 region.

My position: Sideline.
Day range for EUR/USD: 100 pips

Related Post: GBP/USD on 25-Dec-2010
GBP/USD on 21-Dec-2010