Following is a selection of comments from analysts on important technical developments in the foreign exchange market.
RBS
EURO/DOLLAR: "There is a cluster of highs just where the EUR came to the end of its rally between $1.4438 and $1.4471 into Friday and considering the rally yesterday one imagines profits will be taken at these levels and I think that $1.4471 could be the top of what we see today whilst the lower end of the range around $1.4255/43.
"My bias is if anything a break topside from the range especially if the Spanish yields begin trading significantly below 5.68 percent."
STERLING/DOLLAR: "GBP/USD seems to have gone from a longer term sell to a short-term buy as the previous head-and-shoulders pattern fails through its neckline and in turn forms an inverse head-and-shoulders pattern that points to a target to the high of the top right hand shoulder at $1.6546.
"Intraday on the anticipation that some profit taking could occur into the weekend we could see some pull backs first thing to the 1.6263 level but that just represents better opportunities for longs back to the highs onto $1.6416. So overall pretty constructive for GBP vs USD stopping through $1.6212 intraday."
EURO/STERLING: "The 88.51 pence level is going to be tough resistance and even through there between 88.75/88.88 is another zone to look out for so I think that they are the two fade zones intraday. Should I be wrong then the technical levels to look out for above there is 89.39 and 89.74."
DOLLAR/YEN: "At last the target hit from the bear flag that has been highlighted over the past eight trading days. So looking into today's session I think we could see some basing around this area and I expect to a slightly more positive tone to the market looking forward.
"I think the week will close above 78.16 yen and if it does could be urged to flip these shorts into longs and expect moves back to 79.71 potentially 80.16. Should I be wrong then the next support comes in at 76.53."
JP MORGAN
EURO/DOLLAR: "As key resistance between $1.4404 and $1.4488 (76.4 percent retracement/daily trend) in EUR/USD has not been broken yet, we still have to handle this market with care. Below this resistance zone, the market still runs the great risk of performing yet another countertrend rally only, what would conclusively have to be followed by acceleration lower."
STERLING/DOLLAR: "The same (scenario for euro/dollar) applies for Cable below $1.6368 (76.4 percent retracement) to 1.6520/49 (76.4 percent retracement/pivot) and only a break above the latter would put the odds in favour of a stronger recovery to $1.7044/49 or $1.7332 (pivots/50 percent retracement)."
EURO CROSSES: "EUR/JPY and EUR/GBP have also failed to break decisive resistance barriers at 113.50 yen (pivot) and at 88.43/48 pence (38.2 percent retracement/pivot) so far, what would be required though to eliminate the risk of performing countertrend rallies only. EUR/Commodity FX is in this respect not any different as key resistance barriers at C$1.3661/95 (pivot/38.2 percent retracement) in EUR/CAD, at $A1.3328/74 to 1.3407 (38.2 percent retracement/pivot/daily breakout line) in EUR/AUD and at NZ$1.6735 (last intra-day top) in EUR/NZD hasn't even been scratched yet."
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