USD/Majors range bound ahead og US GDP

Not much to go by in the European session so far. The USD has been on the bid side after yesterday's rally in EURUSD and GBPUSD. Also USDJPY finding some support on weaker then expected Japanese data.

MAJOR HEADLINES – PREVIOUS SESSION
USD

Really disappointing figures for the last couple of weeks. The question is if the market fully has digested the slowdown in US GDP growth yet. Talk about cutting the Fed's Funds Rate could be a negative going forward.

EUR

Looking relatively strong after the return above 1.2750. Relatively strong E-Z economy and we expect hawkish tones from the ECB Press Conference tomorrow. Also favored by fixed income going higher.

JPY

Finding support from extreme readings of rate spread changes. In only 1 percent of weeks since 2000, weekly rate spread changes have been favoring JPY more in the crosses than currently. We could get a big reaction in JPY crosses on this note. Also some talk about the Japanese government being concerned about the number and magnitude of the JPY carry trades that ordinary Japanese retail investors are involved in. Could see some hawkish rhetoric on this note going forward.

Euro/US Dollar    

EURUSD  (1.2759 @ 12:41 GMT)

Support:

1.  1.2460 daily base which coincides with 1.2465 38% retracement

2.  1.2320 double top form march 2006

3.  1.2260 bull trend line from March 2006

4.  1.1635 38% retracement (0.8350-1.3667), also low from 2005.

Resistance:

1.  1.2670 old wave support from late September 2006.

2.  1.2764 high from October 2006.

3.  1.2940 old top from August 2006.

4.  1.2980 long term inverse head-and-shoulder target.

5.  1.3175 upper bull trend channel from March 2006.

 Resist.

1.2949

1.2845

1.2804

1.2759

1.2700

1.2637

1.2533

Support

British Pound/US Dollar    

GBPUSD  (1.9086 @ 12:41 GMT)

Support:

1.  1.8520 lower end of the bear channel from early August 2006.

2.  1.8500 daily base support.

3.  1.8325 wave high from March 2005.

4.  1.8090 wave support from July 2006.

5. 1.7330 long term bull trend support from 2001.

Resistance:

1.  1.8860 old top from late October.

2.  1.8900-5 top from early October along with 615 retracement (1.9072-1.8632).

3.  1.9145 Old top from August.

4.  1.9215 old top from April 2005.

5. 1.9550 highs from december 2004.

 Resist.

1.9327

1.9185

1.9129

1.9086

1.8988

1.8902

1.8761

Support

US Dollar/Japanese Yen    

USDJPY  (116.91 @ 12:41 GMT)

Support:

1.  118.40 intra-week retracement support.

2.  116.75 daily base support.

3.  115.55 wave low from April (key level as it would take our weeky lower high/higher high, which would confirm accelerated downside)

4.  113.35 weekly base support.

5. 109.00 key support form confirmation of a monthly downward trend.

Resistance:

1.  119.20 choppy range base from early October.

2.  119.90 old top from mid-October.

3.  121.40 old top from December 2005.

4.  1250.00 50% retracement (form 147.63-101.67).

Resist.

120.07

118.64

117.81

116.91

116.38

115.78

114.35

Support