Forex prices stalls..

A Classic example of the currency market that stalls after a wide daily price move.

For a better understanding let us review the most recent market action in comparison with price alignments of the USDX.

After achieving its objective above the 81.10 with a high at 81.45 bp; with the USDCHF at 0.9550 and the EURUSD's opening price extension levels at the 1.2660/80, this combined price adjustment has made it possible for a daily corrective move for the 2nd trading week for January.This is also discussed in our recent educational Forex article on 'Market Timing in FX Trading' article below. 

The corrective move for the EURUSD at 1.2818 was an initial attempt for the start of the week where the 1st resistance price of 1.2880 will be tested as the current price level serves as a wide spread price differential from its 21 day MA of 1.2930. Currently the EURUSD is at 1.2737 pullback price from its high and relatively feeling the pressure for its weakness has caused the same price swing with the EURGBP from a high at 0.8286 and is at 0.8240 as of this writing. A contrary swing would not be discounted as net overly bias-bearish positions outweigh long outstanding positions versus the GBPUSD currency pair. Thus pushing the pressure favorable for shorts in the EURGBP cross rate within the mid-term downward trend.

A Tight range and lackluster trading across the board in forex market have lessened the activity as it comes mid-week in between the US Dec Retail sales, ECB rate decision and the University of Michigan Confidence figures.

Meanwhile, the AUDUSD & Kiwi has maintained their current status as currency leaders along side with the continued strength of the Japanese Yen. Although,traders and investors reluctance to take any further speculative positions with the Yen and the USDCHF is due to the probability of intervention by central banks and moreover the Euro's price vulnerability from the current meetings in Europe by Sarkozy & Merkel to finally try to resolve the crisis.