Week of August 25, 2008

EURUSD’s short term fall from the August 11, 2008 high at 1.5083 is complete at the August 19, 2008 low at 1.4628 as prices subsequently moved within the 1.4802-1.4909 consolidation zone mentioned in our August 20, 6:00 GMT update, with prices eventually reaching 1.4909 last Friday. Prices have since moved lower today as a 4 hour open and close below 1.4742 will suggest a new short term fall is underway initially targeting 1.4628, as a sustained break here favors further extention to our previously sited objective at 1.4358. As to the medium term fall from the July 15, 2008 high at 1.6037, this fall appears to be impulsive and only a daily open and close above 1.5166 will complete this fall while 1.4628 holds, otherwise risk remains for further extension to the downside. Intraday, prices must hold below 1.4755-1.4797 to suggest continued intraday pressure to the downside, otherwise, a 1 hour open and close above 1.4769 will favor prices to move higher with 1.4797 as the initial objective. ( Please read the August 21, 2008-8:00 GMT Medium and Broad Term Outlook).

GBPUSD’s fall from the August 11, 2008 high of 1.9256 remains active as prices failed to sustain above 1.8796 while 1.8512 held, as prices have since moved lower reaching 1.8403 as of this writing as risk for continued downside pressure remains high with 1.8076 as the next objective. Only a daily open and close above 1.8729 will complete the short term fall from 1.9256 while today’s 1.8403 holds. As to the medium term fall from the March 9, 2008 high at 2.0397 remains active and until prices can open and close on a daily basis above 1.9072 initially, and ideally above 1.9165, then risk remains for further extension lower targeting 1.8076 follwed by the November 2005 low at 1.7058. Intraday, look for offers around 1.8478 to limit before another push lower, otherwise, a sustained break of 1.8495 will eliminate any intraday downside pressure. The medium term and broad term trend remains down. ( Please refer to the GBPUSD Medium and Broad Term outlook dated August 18, 2008-7:00 GMT).

We will have more updates later.

Forex Signals Plus, RW