Outlooks for nine major currency pairs today

Following are expected trading ranges and outlooks for nine major currency pairs today:

Immediate Range Larger Range
USD/JPY 89.90-90.55 89.69-91.29
EUR/USD 1.3494-1.3589 1.3442-1.3691
AUD/USD 0.8877-0.8975 0.8845-0.9071
NZD/USD 0.6894-0.6995 0.6803-0.7058
GBP/USD 1.5392-1.5474 1.5345-1.5575
USD/CHF 1.0786-1.0848 1.0710-1.0898
USD/CAD 1.0500-1.0578 1.0379-1.0631
EUR/JPY 121.55-122.70 121.37-124.56
EUR/GBP 0.8745-0.8791 0.8699-0.8836

(Ranges are calculated using recent high and lows, information on the placement of option strikes, and technical analysis - Fibonacci levels, trendlines and moving averages.)

USD/JPY - to consolidate with bearish bias. Pair undermined by unwinding of JPY-funded carry trades amid higher investor risk aversion (VIX fear gauge up 7.17% at 21.37) as U.S. stocks fell overnight (DJIA off 0.97%, Nasdaq off 1.28%), economic optimism deflated after unexpectedly large drop in U.S. Conference Board consumer confidence index (declined to 46.0 in February from revised 56.5 in January, vs forecast for 54.8), news Greece's top banks had been downgraded. USD/JPY also undermined by Japan exporter sales, lower U.S. Treasury yields. But USD/JPY losses tempered by USD demand for import settlements, caution heading into 1500 GMT Fed Chairman Bernanke's Senate testimony which market participants watching for clues on Fed's plans to exit stimulus policy. Other data focus: 2350 GMT Japan January provisional trade statistics, January corporate service price index, 1500 GMT U.S. January new home sales. USD/JPY daily chart negative-biased as spot broke below uptrend line from Feb. 4 low of 88.54 (now at 90.55, matching previous base set Thursday), stochastics falling from overbought, positive MACD histogram bars contracting. Support at 89.90 (yesterday's low); breach would target 89.69 (Feb. 16 low), then 89.56 (Feb. 12 low), 89.12 (Feb. 8 low) and 88.54 (Feb. 4 reaction low). Resistance at 90.55; breach would expose upside to 91.29 (yesterday's high), then 91.90 (Monday's high), 92.14 (Friday's high, just below 200-day moving average) and 92.43 (Jan. 12 high).

EUR/USD - to trade with risks skewed lower. Pair undermined by unwinding of long-EUR carry trades on higher risk aversion, surprise drop in German Ifo German business climate index to 95.2 in February from 95.8 in January (vs forecast for rise to 96.4), persistent worries over euro-zone fiscal problems, Fitch Ratings' downgrade of 3 Greek banks' covered bonds; BOE Gov. King's comment that recovery in euro zone "appears to have stalled." Data focus: 0700 GMT Germany revised 4Q GDP, 0710 GMT Germany March GfK consumer climate survey, 1000 GMT euro-zone December new industrial orders, 1000 GMT ECB's Smaghi speaks. EUR/USD daily chart mixed as MACD in bullish mode, but stochastics bearish at oversold. Support at 1.3494 (yesterday's low); breach would expose downside to 1.3442 (9-month low hit Friday), then 1.3420 (May 18 reaction low), psychological 1.3400 and 1.3315 (projected base of descending channel formed with Dec. 3 high of 1.5141 and Dec. 22 low of 1.4216). Resistance at 1.3589 (hourly chart); breach would expose upside to 1.3691 (yesterday's high), then 1.3789 (Feb. 17 reaction high), 1.3801 (Feb. 11 high) and 1.3839 (Feb. 9 reaction high).

AUD/USD - to trade with risks skewed lower. Pair undermined by unwinding of long-AUD carry trades on heightened risk aversion, softer commodity prices (CRB spot index closed down 4.68 yesterday at 272.1). But AUD/USD losses tempered by Aussie-U.S. yield gap, expectations for further rate hikes by RBA this year. Data focus: 0030 GMT Australia 4Q labour price index, 4Q construction work done. AUD/USD daily chart negative-biased as stochastics bearish at overbought, positive MACD histogram bars contracting, bearish key-reversal-day pattern completed yesterday. Support at 0.8877 (yesterday's low, matching Feb. 16 & Friday's low); breach would target 0.8845 (Feb. 15 low), then 0.8781 (Feb. 12 low) and 0.8707 (Feb. 10 low). Resistance at 0.8975 (hourly chart); breach would expose upside to 0.9071 (yesterday's high, coinciding with 100-day moving average), then 0.9152 (76.4% Fibonacci retracement of 0.9330-0.8576 Jan.14-Feb.5 decline).

NZD/USD - to trade with risks skewed lower. Pair undermined by unwinding of long-NZD carry trades on stronger risk aversion, softer commodity prices. But NZD/USD losses tempered by Kiwi-U.S. yield advantage. NZD/USD daily chart negative-biased as stochastics bearish, positive MACD histogram bars contracting. Support at 0.6894 (yesterday's low, matching Feb. 12 low); breach would expose downside to 0.6803 (5-month low hit Feb. 5), then psychological 0.6700 level and 0.6682 (Sept. 2 reaction low). Resistance at 0.6995 (hourly chart); breach would expose upside to 0.7058 (yesterday's high), then 0.7079 (Feb. 16 and Feb. 17 high), 0.7122 (50% Fibonacci retracement of 0.7441-0.6803 Jan. 14-Feb. 5 decline) and 0.7138 (55-day moving average).

GBP/USD - to trade with risks skewed lower. Pair undermined by capital flight to safe-haven USD amid inflamed investor risk aversion, official nod for weaker GBP, persistent investor concerns over weak UK fiscal situation; very dovish delivery yesterday from MPC members before UK Treasury Select Committee: BOE Gov. King offered very cautious outlook for UK economy with risks to downside, leaving door open to eventual resumption of central bank's quantitative-easing program, while BOE's Miles said, "If the news is that the economic outlook seems even weaker, inflation pressures lower... I think there's a strong case then for expanding further the asset purchases." GBP/USD daily chart negative-biased as MACD bearish, while stochastics stay suppressed at oversold, suggesting sideways or lower GBP/USD trading near-term . Support at 1.5392 (yesterday's low); breach would target 1.5345 (9-month low hit Friday), then psychological 1.5300 and 1.5271 (50% Fibonacci retracement level of advance from Jan. 23, 2009 low of 1.3500 to Aug. 5 high of 1.7042). Resistance at 1.5474 (hourly chart); breach would expose upside to 1.5575 (yesterday's high), then 1.5687 (Thursday's high), 1.5816 (Feb. 17 high), 1.5830 (previous base set Dec. 30) and 1.5848 (previous base set Feb. 1).

USD/CHF - to consolidate with risks skewed higher. Pair underpinned by broadly stronger USD undertone, fears of more CHF-selling FX intervention by SNB: traders suspect central bank yesterday bought EUR/CHF during Asian & European trading near 1.4650. But USD/CHF topside limited by unwinding of short-CHF carry trades on higher risk aversion. Daily chart mixed as stochastics stay elevated at overbought, MACD neutral. Resistance at 1.0848 (yesterday's high); breach would expose upside to 1.0898 (7-month high hit Friday), then 1.0934 (July 30 reaction high) and 1.1020 (June 24 reaction high). Support at 1.0786 (hourly chart); breach would expose downside to 1.0710 (yesterday's low), then 1.0644 (Feb. 17 low), 1.0623 (Feb. 11 low) and 1.0605 (Feb. 9 reaction low).

USD/CAD - to trade with risks skewed higher. Pair underpinned by increased investor risk aversion, stronger global USD, weaker commodity and oil prices (Nymex crude settled down $1.45 yesterday at $78.86/barrel). USD/CAD daily chart positive-biased as stochastics rising from oversold; negative MACD histogram bars contracting. Resistance at 1.0578 (yesterday's and Feb. 12 high); breach would expose upside to 1.0631 (Feb. 11 high), then 1.0707 (Feb. 10 high), 1.0780 (Nov. 6 & Feb. 5 high, near 200-day moving average) and 1.0869 (Nov. 2 reaction high). Support at 1.0500 (hourly chart); breach would expose downside to 1.0379 (yesterday's low), then 1.0368 (Monday's low), 1.0301 (Jan. 20 low) and 1.0246 (Jan. 19 low).

EUR/JPY - to trade with risks skewed lower. Cross undermined by unwinding of carry trades amid increased risk aversion, persistent worries over euro-zone sovereign debt problems; but downside limited by caution before U.S. Fed Chairman Bernanke's Senate testimony today. EUR/JPY daily chart mixed as MACD bullish, but stochastics turned bearish. Support at 121.55 (yesterday's low), then at 121.37 (Feb. 12 reaction low); breach would expose downside to 120.67 (1-year low hit Feb. 5), then psychological 120.00 level. Resistance at 122.70 (hourly chart); breach would expose upside to 124.56 (yesterday's high), then 125.23 (Monday's high), 125.91 (38.2% Fibonacci correction of 134.39-120.67 Jan. 11- Feb. 5 decline) and 126.97 (Feb. 3 reaction high).

EUR/GBP - to consolidate with risks skewed lower. Daily chart mixed as MACD bullish, but stochastics turning bearish; bearish key-reversal-day pattern completed yesterday. Support at 0.8745 (previous cap set Feb. 16); breach would expose downside to 0.8699 (Friday's low), then 0.8656 (Feb. 12 low) and 0.8627 (Jan. 29 low). Resistance at 0.8791 (hourly chart); breach would target 0.8836 (yesterday's high, coinciding with 55-day moving average), then 0.8846 (Feb. 11 high), 0.8933 (100-day moving average) and 0.9028 (Jan. 12 reaction high).

-By Jerry Tan, Dow Jones Newswires; (65) 6415-4046; Jerry.tan@dowjones.com