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Mizuho Corporate Bank

Weekly Technical Commentary 09 August 2010


Links: http://www.mizuho-sc.com/ Bloomberg Page: MIZH Website: http://www.mizuho-cb.co.uk/

GBP/USD Chart Levels: Support 1.5800..1.5700..1.5565..1.5400. Resistance 1.6000..1.6225..1.6300..1.6500.


GBP=D3, Last Quote [Candle], Last Quote [Ichimoku 9, 26, 52, 26] Weekly
01Aug09 - 15Feb11 This week This month
Pr
GBP=D3 , Last Quote, Candle
1.7
15Aug10 1.5975 1.5998 1.5931 1.5944
GBP=D3 , Last Quote, Tenkan Sen 9
15Aug10 1.5272 1.68
GBP=D3 , Last Quote, Kijun Sen 26
15Aug10 1.5114
GBP=D3 , Last Quote, Senkou Span(a) 52
06Feb11 1.5193
1.66 A sterling performance as Cable retraces all of
GBP=D3 , Last Quote, Senkou Span(b) 52
06Feb11 1.5554 1.64
the loses since early February, over 61% of the
decline since November 2008, testing the top of
GBP=D3 , Last Quote, Chikou Span 26
21Feb10 1.5944
1.62
a very large weekly Ichimoku ‘cloud’ and the
1.6
psychological level at 1.6000. Nine and twenty-
six week moving averages have crossed to a
61.8
1.58

1.56
long position which should help push this pair up
50.0
to our next upside target at 1.6500 seeing as
1.54

38.2
bullish momentum is stronger than it has been
1.52
in a year. Cable is overbought though, yet one-
1.5 month at-the-money implied volatility is only
1.48 fractionally higher than its long term mean at
1.46
8.80%. More short-covering is likely to emerge
soon. Note that important long term resistance
1.44
lies between 1.6800 and 1.7000 and only above
1.42 here will serious fretting start.
Sep09 Oct Nov Dec Jan10 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan11 Feb

EUR/GBP Chart Levels: Support 0.8250..0.8180..0.8100..0.8065. Resistance 0.8415..0.8465..0.8535..0.8600.


EURGBP=D3, Last Quote [Candle], Last Quote [Ichimoku 9, 26, 52, 26] Weekly
30Nov08 - 30Jan11 This week This month
Pr
EURGBP=D3 , Last Quote, Candle 0.98
01Aug10 0.83630 0.83810 0.83245 0.83275
EURGBP=D3 , Last Quote, Tenkan Sen 9 0.97
01Aug10 0.83000
EURGBP=D3 , Last Quote, Kijun Sen 26 0.96
01Aug10 0.86085
EURGBP=D3 , Last Quote, Senkou Span(a) 52
0.95
Consolidating in neat little ranges at some of the
lowest levels since Lehman’s collapse in 2008.
23Jan11 0.84543
EURGBP=D3 , Last Quote, Senkou Span(b) 52
23Jan11 0.87400 0.94
EURGBP=D3 , Last Quote, Chikou Span 26
07Feb10 0.83275 0.93
Prices remain in the narrow ‘channel’ with July’s
0.92
small ‘spike high’ at 0.8532 possibly marking a
0.91
new interim high point. Weekly moving
0.9
averages still point to a short position so over
0.89
the next week and maybe the coming month we
0.88
favour consolidation between 0.8067, this year’s
0.87
low, and 0.8500. Then the gentle downtrend
0.86
ought to resume taking the Euro down to
'spike high' 0.85
0.8000 and probably 0.7800 some time in the
0.84
autumn. Note the lower edge of the weekly
0.83
‘cloud’ starts dropping mid-October so hopefully
0.82
by the sterling will start holding clearly below
0.81
the pivotal 0.8400 area. A weekly close above
0.8 0.8700 would be very worrying.
Dec08 Jan09 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan10 Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan11

Produced by London Branch - Nicole Elliott +44-20-7786-2509 (email: Nicole.Elliott@mhcb.co.uk)


The information contained in this paper is based on or derived from information generally available to the public from sources believed to be reliable. No representation or
warranty is made or implied that it is accurate or complete. Any opinions expressed in this paper are subject to change without notice. This paper has been prepared
solely for information purposes and if so decided, for private circulation and does not constitute any solicitation to buy or sell any instrument, or to engage in any trading
strategy.

Charts provided by Reuters.