Early Technical Analysis for Tuesday August 1 2006

Full report with charts on Forexalt.com

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Early Technical Analysis: The Players concern "Rates" a theme

The American dollar has continued falling at the tenders last day July, despite of favorable news on the American economy. To tell the truth, the impulse of dollar bears has strongly weakened, and falling was not so intensive, like on Friday.
Chicago Index reflecting business activity in the industry of this region has grown up to 57.9 items against the forecast about decrease to 56.0 items. This parameter, and also other regional indexes, force investors to hope for a strong parameter of a federal index of business activity in a manufacturing industry which publishes Institute of managers on deliveries. Meanwhile the market has not reacted in any way to this news, as players concerned exclusive "rates" a theme.
In the yesterday's performance president FRB of St. Louis William Poole, has declared, that, in his opinion, the probability of increase of the rate next week makes 50:50. It has specified growth of inflation as a major factor playing advantage of toughening of monetary policy.
However words of Poole did not render essential influence on the market - as in the given structure of FOMC it has no vote. And here his colleague - a voting member - Janet L. Yellen who has become famous for the care concerning a credit policy declared approach the termination of a cycle of rate increases. She also has noted that each FRS decision affects economy with delay; therefore, to reach effect from the previous increases, it is necessary to wait.

EUR
Weekly chart EUR trend – Range
Resistances
1.2771/78 (high 07.28.2006 at 1.2771 and 61.8% retracement of 1.3483 to 1.1640 at 1.2778 and 61.8% retracement of 1.2978 to 1.2459 at 1.2778), 1.2860 (high 07.07.2006), 1.2971/78 (highs 05.15.2006 and 06.05.2006)
Supports
1.2705/06 (23.6% retracement from 1.1825 to 1.2978 at 1.2705 and 61.8% retracement from 1.2860 to 1.2459 at 1.2706), 1.2660/57 (50.0% retracement of 1.2860 to 1.2459 at 1.2660 and 38.2% retracement of 1.2978 to 1.2459 at 1.2657), 1.2560/55 (50.0% retracement of 1.3483 to 1.1640 at 1.2560 and 23.6% retracement of 1.2860 to 1.2459 at 1.2555)

GBP
Weekly chart GBP trend - Range
Resistances
1.8672/87 (Thursday high 07.27.2006 at 1.8672 and Monday’s high 07.31.2006 at1.8687), 1.8877 (high 06.05.2006), 1.8960/1.9023 (76.4% retracement of 1.9554 to 1.7047 at 1.8960 and high 05.17.2006 at 1.9023)
Supports
1.8595/1.8605 (61.8% retracement of 1.9554 to 1.7047 at 1.8595 and 23.6% retracement of 1.7229 to 1.9023 at 1.8605), 1.8515 (the bottom line of the “yellow” channel), 1.8450 (the bottom line of the “lime-green” channel)

CHF
Weekly chart CHF trend - Bullish
Resistances
1.2439/23 (61.8% retracement of 1.1287 to 1.4281 at 1.2439 and the 38.2% retracement from 1.3237 to 1.1920 at 1.2423), 1.2545 (high 07.25.2006), 1.2585/93 (50.0% retracement from 1.3237 to 1.1920 at 1.2585 and Wednesday high 07.19.2006 at 1.2593)
Supports
1.2285/83 (50.0% retracement from 1.1287 to 1.3284 at 1.2285 and 76.4% retracement from 1.2185 to 1.2593 at 1.2283), 1.2185/78(low 07.07.2006 and 61.8% retracement of 1.1920 to 1.2593 at 1.2178), 1.2015 (low 06.05.2006)

JPY
Weekly chart JPY trend – Capped?
Resistances
115.40 (61.8% retracement from 119.37 to 108.96), 115.77/81 (23.6% retracement from 108.96 to 117.86 at 115.77 and low 07.21.2006 at 115.81), 116.70/90 (resistance line from high 12.04.2005 to 04.11.2006 at 116.70 and 76.4% retracement of 119.37 to 108.96 at 116.90)
Supports
114.19 (50.0% retracement from 119.37 to 108.96), 113.44/43 (low 07.10.2006 and 50% retracement of 108.96 to 117.86 at 113.43), 112.95 (38.2% retracement from 119.37 to 108.96)