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EURGBP: Builds On Recovery Gains.

EURGBP- After reversing its intra day losses to close higher on Tuesday and following through higher today, further bull pressure is now building up on its May 09’2011 high at 0.8817.

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A break and hold above there will bring the 0.8896 level, its May 05’2011 high and ultimately the 0.9040 level, its year-to-date high. Its daily momentum indicators are bullish and pointing higher suggesting further gains.  

Alternatively, the risk to our upside view will be a return below the 0.8653 level, its Mar 23’2011 high with a violation of that level turning focus to the 0.8532 level and probably the 0.8500 level, its psycho level.

A halt in weakness is expected at that level to turn EURGBP higher if tested.

EURUSD: In Recovery Mode But Vulnerable

EURUSD: Attempts at building on recovery gains continue to be seen but with alot of price hesitation. Additionally, as long as the 1.4339 level, its May 13’2011 high and the 1.4422 level, its May 11’2011 hold as resistance levels, our   bias remains lower.

On the downside, below the 1.4046 level, its May 16’2011 low will reverse its present recovery attempt and turn risk towards the 1.4020/00 levels, its mar 28’2011 low/psycho level.

A combination of these levels should halt declines if seen and turn the pair back up. Further down, the 1.3852 level comes in as the next downside target.

Alternatively, on a violation of 1.4339 level and the 1.4422 level, further strength should build up towards   its May 06’2011 high at 1.4586 and ultimately the 1.4938 level, its 2011 high.

All in all, though attempting a recovery, it remains vulnerable to the downside nearer term.