Archived IMT (2010.03.24)

EURUSD finally breaks below $1.35 over two consecutive sessions (US and Asia) for the first time since May 2009. CONGESTION STANDS between $1.3415 and $1.3465, with the former being the 61.8% retracement of the 1.2442-1.5129 rally, and the latter (more relevant support) being the 76.4% retracement of the 1.2885-1.5129 rally. Bottom line, traders will eye $1.34 as the next major foundation, before $1.3120. THE USD INDEX is POINTS AWAY FROM A GOLDEN CROSS FORMATION, whereby the 100-day MA 77.92 is to cross above the 200-day MA (78.07) for the first time since July 2009. Recall we ALERTED READERS back on Jan 19 http://bit.ly/8EZTO8 of the DEAD CROSS formation in EURUSD (50-day MA falling below the 100-day MA) 18 hours before it occurred, which triggered a 230pip decline the next day. Much is being said about rumours of an IMF-led deal for Greece, but the technicals suggest any bounce will be short-lived. UK BUGET ANNOUNCEMENT will seek to balance between announcing a reduction in the deficit with a combination of spending cuts and tax hikes (probably in capital gains), which will raise the question as to whether the BoE will be forced into prolonged QE.