EUR/USD - Euro bulls retreated further after the dollar traders pushed the pair below 1.1865, a level marked by the 23.6 Fib of the 1.2588-1.1639 USD rally. A further move on the part of the dollar longs will most likely see the pair head lower and target euro's bids around 1.1778, a level established by the December 30 daily low and with sustained momentum to the downside most likely seeing the EUR/USD break below the 1.1704, a level marked by the December 7 daily low. A further momentum on the part of the greenback longs will most likely see EUR/USD test bids around 1.1639, a level established by 2005 low, which acts as a gateway toward the psychologically important 1.1500 handle. A further move below the 1.1500 figure will most likely signal that a dollar dominated trend is underway which will most likely see the pair decline toward 1.1000. Indicators are favoring dollar longs with both negative momentum indicator and MACD trading below the zero line, while neutral oscillators give either side enough room to maneuver.

USD/JPY - Japanese Yen longs continued to push the pair lower and broke below 116.76, a level marked by the 50-day SMA, but failed to extend a move beyond the 116.00 figure. A further move to the downside will most likely see the yen longs move toward the psychologically important 115.00 handle and target dollar bids around 114.80, a level established by the 38.2 Fib of the 104.16-121.46 USD rally. A further move on the part of the Japanese yen longs will most likely see the pair extend its decline toward 113.87, a level defended by the 200-day SMA. However in case yen longs fail to break below 116.00, a subsequent reversal will most likely see the greenback longs takeover the price action and with a move above 117.38, a level established by the 23.6 Fib of the 104.16-121.46 USD rally most likely targeting yen offers around 117.90, a level marked by the 20-day SMA. Indicators are mixed with negative momentum indicator diverging from positive MACD above the zero line, while neutral oscillators give either side enough room to maneuver.

GBP/USD - British pound longs remained under pressure as dollar bulls continue their advance and pushed the pair below 1.7391, a level defended by the 23.6 Fib of the 1.8500-1.7048 USD rally. A further move to the downside will most likely see GBP/USD collapse toward 1.7312, a level marked by the July 8 daily low. A sustained momentum on the part of the greenback longs will most likely see the greenback bulls extend their rally below the 1.7200 figure and target pound bids around 1.7188, a level established by the January 3 daily low. A further move on the part of the dollar longs will most likely see the GBP/USD aim for 1.7048, a level defended by the November 11 daily low, breaking of which will most likely see the pair gain additional momentum and head below the psychologically important 1.7000 handle thus targeting the next potential support around 1.6900 figure, a level not seen since October of 2003. Indicators are favoring dollar longs with both negative momentum indicator and MACD trading below the zero line, while neutral oscillators give either side enough room to maneuver.

USD/CHF - Swiss Franc bulls continued to retreat as greenback traders pushed their way above 1.3201, a level established by December 30 daily high. A further move to the upside will most likely see the pair test Swissie's offers around 1.3285, a level established by the 2005 high. A confirmed break above the trading range's high will most likely see the pair aim for the next psychologically important 1.3500 handle, a level defended by the Swiss Franc offers around 1.3446, an October 17, 2003 daily high. A sustained momentum on the part of the dollar bulls will most likely see USD/CHF break above the next psychologically important 1.3500 handle and with a further move to the upside extending their rally toward 1.3605, a level established by the November 7, 2003 daily low. Indicators are favoring the dollar longs with both positive momentum indicator and MACD above the zero line, while neutral oscillators give either side enough room to maneuver.

USD/CAD - Canadian dollar managed to push the pair lower as USD/CAD broke below the greenback bids around 1.1433, a level established by the December 14 daily low. A further move to the downside will most likely see the pair extend its decline toward 1.1374, a level marked by the January 31 daily low and with a move below the 1.1300 figure targeting potential support at 1.1249, a level marked by the 1.00 Fib Extension of the Nov-Dec CAD rally. A further move on the part of the Loonie longs will most likely see the pair extend its decline toward the psychologically important 1.1000 handle, a level defended by the 1.382 Fib Extension of the Nov-Dec CAD rally at 1.1040, thus seeing the Canadian dollar enter into a trend mode. Indicators are favoring Canadian dollar longs with both negative momentum indicator and MACD treading below the zero line, while neutral oscillators give either side enough room to maneuver.

AUD/USD - Australian dollar bulls continued to tread sideways in a narrow range that dominated the price action since the beginning of December. As pair remains below .7400 figure, a move on the part of the US dollar longs will most likely see AUD/USD head lower and test Aussie the bids around .7321, a level created by the November 24 daily low, and with a break below most likely seeing the AUD/USD break .7300 figure and target Aussie bids around .7234, a level defended by the December 27 daily low. A sustained break below .7234 will most likely see the US dollar bulls head lower and target the Australian dollar offers around .7130, a level created by the September 29, 2004 daily low, which currently acts as a gateway toward the psychologically important .7000 handle. Indicators are favoring US dollar longs with both negative momentum indicator and MACD trading below the zero line while neutral oscillators give either side enough room to maneuver.

NZD/USD - New Zealand dollar longs once again failed to keep the pair above the .6600 figure after encountering active US dollar offers around .6615, a level marked by the July 19, 2004 daily high. As greenback bulls continue their attack and push the pair lower, a further move to the downside will most likely see the US dollar bulls test New Zealand dollar defenses around .6507, a level established by the 61.8 Fib of the .5914-.7466 NZD rally. A break below the psychologically important .6500 handle will most likely see the pair head lower and test the bids around .6414, September 4, 2004 daily low. A sustained momentum on the part of the US dollar traders will most likely see the pair extend its decline below the .6300 figure and target the New Zealand dollar offers around .6246, a level defended by the 78.6 Fib of the .5914-.7466 NZD rally. Indicators are favoring US dollar longs with both negative momentum indicator and positive MACD above the zero line, while ADX above 25 at 30.50 signals an existence of a trend, not a direction of one, with oversold Stochastic adding to a trending outlook.

Sam Shenker is a Technical Currency Analyst for FXCM.