Pound's rally from 1.6625 seen on early Asian session, has been capped at 1.6720 resistance area, and the pair has dropped below 1.6650, giving back most of the ground taken during Asian trade.
Below 1.6650 (Dec 1 high), next resistance levels lie at 1.6625 and 1.6590 (Nov 30 high). On the upside, resistance levels lie at 1.6700, and above here, 1.6725 (Nov 26 high) and 1.6755 (Nov 19 high).
On a wider perspective, Nicole Elliott, senior technical analyst at Mizuho Corporate Bank sees the Euro on a bullish pattern which could lead towards a re-test of 1.7045 year high: "Working in a sort of ‘flag’ since November, a continuation pattern that should lead to a re-test of this year’s high at 1.7044. It is not overbought though bullish momentum is not as strong as some might like."
Dollar recovery from 84.80 low on November 26 has extended to levels right below 88.00 during Thursday's Asian session, testing the lower band of 87.90/88.20 key resistance area. according to Alex Rudolph, technical analyst at Commerzbank.
In case of confirmation above 88.20, the Dollar next target would be 89.18/66 area, says Rudolph: "Our anticipated recovery to 87.91/88.20 is in the making with the lower level having now been reached. Once it and 88.20 have given way though, the 89.18/89.66 area (Nov. 2 low and downtrend) will be targeted."
On the downside, Rudolph points out to 84.80 support: "We look for an attempt to base at 84.80/00. Below 84.00 would target the major psychological 80.00 region."
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