Forex Investment and Currency Trading

Very good resistance is met at 80.39 (2004 low) on the USD-Index. A break through here would suggest a continuation of this move to test the converged cannel top/ 200 week moving average resistance at 82.78-82.80

Major support is now under threat between 106 and 106.50. A weekly close below here would
extend the downside potential.

The bottom line is that the financial and economic crisis continues and as yet we do not seem
to have a “watershed” event sufficient to stop it in its tracks.

Until we do the danger remains for continued de-leveraging across financial markets. If so
then there remains a likelihood that we can still see

• Lower yields and possibly flatter curves
• Lower equities
• Lower commodities with Gold and Crude possibly heading towards their 200 week moving
  averages
• Lower FX “risk crosses” i.e. Stronger JPY and CHF versus AUD,NZD,GBP,EUR etc
• Stronger USD against those same currencies.