EUR/USD â�,�“ The EURUSD has slipped below the 12/11 low of 1.3126, bringing forward the possibility that the pair is headed towards the 38.2% fibo of 1.2483-1.3367 at 1.3030.  A steep potential supporting trendline, drawn off of the 10/24 and 11/27 lows, is at 1.3046 today.  Bolstering the bearish case is the EURUSD close below the 20 day SMA for the first time since 10/25 on Friday.  On the flip side, the pair could bottom out near 1.3052 â�,�“ the decline from 1.3292 would equal the 1.3367-1.3126 decline at 1.3052 (a classic a-b-c correction).  There is little confidence in direction at the current juncture due to the possibility of a bottom nearby and the break below 1.3126.

USD/JPY â�,�“ USDJPY has eased back from Fridayâ�,��"�s high of 118.32 just after RSI dropped from overbought levels. Nevertheless, oscillators remain bullish as the inverse head and shoulders pattern discussed last week continues to take shape.  â�,��"The pattern since the 12/5/2005 high at 121.38 has taken on the form of an inverse head and shoulders pattern.  However, a rally through the neckline is required to complete the pattern.  The neckline is drawn off of the 12/5/2005 and 10/13/2005 highs and is near 119.60 today (decreases about 2 pips per day).â�,�  The 23.6% fibo of 114.42 â�,�“ 118.32 at 117.40 is initial support.

GBP/USD â�,�“ Cable continues to ease back from the highs achieved in early December and remains in a triangle formation with price nearing the apex.  The recent break below a short term (1 month) supporting trendline on Friday favors continues weakness and a test of the 12/11 low at 1.9464.  The longer term turn signals remain valid â�,�“ that is, RSI crossing below 70 and CCI crossing below 100.  If 1.9464 is given, then support would come in at the 50% fibo of 1.8834-1.9847 at 1.9341.  The upside pivot is the 12/13 high at 1.9727.  A cautious bearish bias is warranted due to the break of the short term trendline.

USD/CHF â�,�“ The USDCHF has distanced itself from the 38.2% of 1.2537-1.1878 at 1.1878 and the pair is currently trading at resistance 38.2% fibo of 1.2768 â�,�“ 1.1878 at 1.2218. The pair closed above the 20 day SMA last Thursday for the first time since 10/25 â�,�“ indicating a medium term shift in trend. As we said on Friday, â�,��"Overbought RSI on the 240 minute chart combined with the 3 wave structure of the advance from 1.1878 may serve to limit gains but only a decline below 1.2097 instills confidence in a bearish scenario.â�,�

USD/CAD â�,�“ The USDCAD rally has lost momentum at channel resistance at the current juncture.  Daily oscillators near or at overbought levels along with divergent short term oscillators gives scope to weakness / consolidation.  Initial support is at the 12/8 high at 1.1516 while the next major level of resistance is not until 1.1771.

AUD/USD â�,�“ The AUDUSD scenario has not changed from Friday when we said, â�,��"The short term double top at .7921/29 along with bearish divergence (daily oscillators) give scope to further weakness in the Aussie.  A decline below .7811 shifts focus to the 11/1 high at .7766.  A push through .7929 negates implications from the bearish evidence and gives scope to the 2004 high at .8003.  The bearish case is reinforced by the break below .7811 / supporting trendline drawn off of the 10/12, 11/14, and 12/14 lows as well as CCI declining through 0.â�,�

NZD/USD â�,�“ The Kiwi has clustered near the 61.8% of .7463-.5927 between .6814 and .6939 and faces immediate resistance at the 78.6% fibo at .6922.  While RSI has declined from above 70 on the daily, the uptrend remains in place above the trendline drawn off of the 6/28 and 11/15 lows.  That line is at .6726 today and increases about 4 pips per day. A short term trendline near .6850 keeps the short term bias bullish.  A decline below this line shifts focus to the 12/6 low at .6814.

Jamie Saettele is a Technical Currency Analyst for FXCM.