EUR/USD - Euro continues to bounce in a tight trading range as the price action remains within a vicinity of the psychologically important 1.2000 handle, a level marked by the 38.2 Fib of the 1.2588-1.1639 USD rally. Given the inability by the euro bulls to gain momentum above the 1.2000 handle, the next move to the downside will most likely see the dollar trader sweep the stops above the 1.1900 figure, which would add to the downside momentum. A sustained momentum to the downside will most likely see the pair head lower and with a move below the 1.1900 handle most likely seeing the dollar traders encountering active euro bids around 1.1840-1.1885 zone, a potential congestion zone created by the combination of the 20-day, 50-day SMA's and the 23.6 Fib of the 1.2588-1.1639 USD rally. A further move to the downside will most likely see the pair break below the 1.1800 figure and target the single currency bids around 1.1776, a level established by December 12 daily low. Indicators are mixed with positive momentum above the zero line and negative MACD sloping upward toward the zero line, while neutral oscillators give either side enough room to maneuver.
 
USD/JPY - Japanese Yen traders managed to push the pair lower, but encountered active bids below the 116.00 handle and retreated to the upside following a week of intense price action. As dollar longs recover part of the lost territory, the next move to the upside will most likely see the pair head higher and test the offers around 117.37, a level established by the 23.6 Fib of the 104.16-141.46 USD rally, which is further reinforced by the 50-day SMA at 117.67. In case the greenback longs prove to be stronger that initially anticipated, a collapse of the yen offers will most likely see the dollar longs extend their retrace above the 118.00 figure and take on the yen defenses around 118.21, a level established by the November 23 daily low. Indicators are diverging with negative momentum indicator below the zero line while positive MACD is sloping downward toward the zero line, with ADX above 25 at 36.73, signaling an existence of a maturing trend, not a direction of one, while neutral oscillators give either side enough room to maneuver.

GBP/USD - British pound traders saw their recent efforts wasted as the pair failed to gain momentum above the 1.7700 handle and collapsed toward the 1.7605, a level established by the 38.2 Fib of the 1.8500-1.7048 USD rally. A further move below the 1.7600 figure will most likely see the pair head lower and with sustained momentum to the downside breaking below the psychologically important 1.7500 handle, a level defended by the 50-day SMA at 1.7494. A further collapse of the sterling bids will most likely see the greenback longs push the pair lower and test the cable defenses around 1.7433, a level established by the 20-day SMA and acts as a gateway toward the 1.7387, a 23.6 Fib of the 1.8500-1.7048 USD rally. Indicators are mixed with positive momentum above the zero line and negative MACD sloping upward toward the zero line, while overbought Stochastic gives the greenback longs a chance to retaliate.

USD/CHF - Swiss Franc bulls treaded sideways after once again climbing above 1.2890, a level established by the key 38.2 Fib of the 1.2240-1.3285 USD rally. As the pair lost the downside momentum and is slowly climbing above the 1.2900 figure, a move above the 1.2950 will most likely see the Swiss Franc traders abort the rally and cover their positions thus adding to the upside momentum that will most likely see the pair head higher and break above the psychologically important 1.300 handle, a level defended by the 50-day SMA. A further move to the upside will most likely see the dollar traders push the pair above the 23.6 Fib of the 1.2240-1.3285 USD rally at 1.3040, a level further reinforced by the 20-day SMA and aim for the Swissie offers around 1.3154, a December 8 daily high. Indicators are mixed with positive momentum above the zero line and negative MACD sloping upward toward the zero line, while neutral oscillators give either side enough room to maneuver.

USD/CAD - Canadian dollar traders continued to engage the US dollar counterparts as the price action remains within a striking distance of the 1.1600 handle. As greenback longs gear up of another advance, a move higher will most likely see the Loonie bulls give up the 1.1600 figure and retreat toward the 1.1686, a level established by October 12 daily low. A further move to the upside will most likely see the US dollar longs test the offers above the 1.1700 handle as they push the pair toward 1.1745, a level established by the combination of the 50-day SMA and the 23.6 Fib of the 1.2733-1.1433 CAD rally. Indicators are favoring of the Canadian dollar longs with both momentum indicator and negative MACD below the zero line, while neutral oscillators give either side enough room to maneuver.

AUD/USD - Australian dollar traders received a temporary pause from the sharp rally staged by the US dollar longs and are currently consolidating some of their gains around .7456, a level marked by the 38.2 Fib of the .7798-.7267 USD rally, and is further reinforced by the combination of the 20-day SMA and 50-day SMA's. A further move by the advancing greenback bulls will most likely see the pair collapse below the .7400 figure and test the bids around .7383, a level marked by the 23.6 Fib of the 7798-.7267 USD rally, and with sustained momentum to the downside most likely seeing the pair tumble further and test the bids around .7321. a level established by the 23.6 Fib of the .7798-.7267 USD rally. Indicators are favoring the Aussie longs with both momentum indicator and positive MACD above the zero line, neutral oscillators give either side enough room to maneuver.

NZD/USD - New Zealand dollar bulls continued to keep the pair above the .6900 figure following the last weeks' sharp correction that saw the pair give up the psychologically important .7000 handle. A bounce from these levels will most likely see the pair head toward the .6963, a level marked by the 50-day SMA and with subsequent reversal once again head below the 6900 handle and taking on the New Zealand dollar bids around .6869 a level established by the 23.6 Fib .7468-.6681 USD rally. A further collapse of the Kiwi's bids will most likely see the US dollar traders push the pair below the .6800 level and test the bids around .6780, a level established by the November 15 daily low. Indicators are mixed with negative momentum indicator below the zero line and positive MACD sloping downward toward the zero line, while neutral oscillators give either side enough room to maneuver.

Sam Shenker is a Technical Currency Analyst for FXCM.