Patterns in the USD crosses are mixed. For example, very short term structure is bullish GBPUSD (above 1.9441) and EURUSD (above 1.5364). These are USD bearish patterns. On the other hand, the AUDUSD and USDCAD patterns are USD bullish. Regardless, there are good opportunities across the board.
We wrote yesterday that “the rally from 1.5283 can be counted as a 5 wave advance and the decline from 1.5488 can be counted as a 3. A rally through 1.5488 warrants a bullish bias.” The EURUSD did push through 1.5488, trading as high as 1.5570 last night before dropping over 100 points. To this point, the decline from 1.5570 is still a 3 (corrective) so there is no reason to change out short term bullish outlook. Keep posted to DailyFX+ though for alerts. Move risk to 1.5364.
STRATEGY: Bullish, against 1.5364, target TBD
Visit our recently updated Euro Currency Room for specific resources geared towards this currency.
We remain bearish as long as the USDJPY is below 105.60. The potential for a sizeable decline in a 3rd of a 3rd wave within the bear cycle from 105.70 does exist. Very near term, a poke through 104.04 is possible before the larger decline resumes.
Visit our recently updated Yen Currency Room for specific resources geared towards this currency.
STRATEGY: Bearish, against 105.60, target TBD
“Over the last 2 months, the pair has gone sideways and it is more likely that this serves to build a bullish base that will lead to a rally through 2.04 in wave Y of a large W-X-Y complex correction.” Cable has rallied from a support line this morning. COT positioning indicates a bearish extreme, which suggests that a GBPUSD rally is in its early stages. Also, very short term charts show that the rally from 1.9441 is impulsive.
Visit our recently updated British Pound Currency Room for specific resources geared towards this currency.
STRATEGY: Bullish, against 1.9441, target above 2.04
The USDCHF pattern is tracking our count nicely. We wrote yesterday that “the drop reached 1.0389 and wave 5 of C is likely in its early stages now.” A rally in wave 5 of C would exceed 1.06 and potentially reach 1.10 in coming weeks. As such, a bullish bias is warranted against 1.0389.
STRATEGY: Bullish, against 1.0389, target above 1.0607
We maintain a bullish bias against .9997 since the rally from there is in 5 waves. Due to the 5 wave advance from .9997, it is proper to treat the decline from 1.0241 as a truncation (wave Y). Very short term, a small 2nd wave (ii) may be complete at 1.0024. The minimum objective is above 1.0324.
Visit our recently updated Canadian Dollar Currency Room for specific resources geared towards this currency
STRATEGY: Bullish, against .9997, target above 1.0324
We wrote Friday that “although the major top is probably in place at .8215, the fastest part of the decline is probably about to begin.” This specific outlook holds as long as price is below .7727 (red line) although the larger bearish bias is valid below .7935.
STRATEGY: Bearish, against .7727, target TBD
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[1] STRATEGY is a summary of our best technical ideas. The ideas are subjective and are subject to change everyday although trades are typically held for at least a few days and sometimes a few weeks or more. Ideas are also included for crosses throughout the week; these are published at separate articles at DailyFX.
