1. EURJPY
2. EURCHF
3. EURGBP
EURJPY EUR/JPY continues to crawl upward, currently trading just above the 146.00 handle. The long term wave structure places us near the end of a 6 year uptrend that began on 10/25/2000 at 88.69. The final wave of this bull market is in the form of an ending diagonal which begins on 6/23/2005 at 130.59. These types of 5th waves are often followed by drastic declines. However, there is still room left for the pair to rally a good deal. An ending diagonal tends to end on a quick spike in the direction of the larger trend. The 78.6% fibo of 164.58 (using synthetic prices)-88.71 at 148.32 could be a potential end to the long term uptrend. Trading could very well be of the range variety until a spike towards the 148.32 area.
EURCHF EUR/CHF rallied to 1.5645 on Friday but formed a double top with the 6/2 high at 1.5650 in the process. This, along with a break of a short term supporting trendline (from 6/14) and bearish divergence with oscillators on the hourly favor shorts. Support is at the 6/20 low of 1.5574 as well as the 6/14 low of 1.5496. Any strength contends with the high from Friday at 1.5645. Bolstering the bearish outlook is a nearly 7 month head and shoulders reversal pattern. The neckline rests at about 1.5500. A break below there opens up the door for the 12/9/05 low at 1.5391.
EURGBP EUR/GBP continues to rally and the pair has broken above a resisting trendline that began on 4/6 at .7020. The pair is nearing a series of daily highs from 1/5 and 6/8 at .6909. A break higher would target the monthly high from May at .6926. A resisting line from May 2003 is at about .6950. Daily oscillators are increasing but not yet overbought leaving plenty of upside potential in the near term.
Glossary of Terms
CCI(20) 20 day Commodity Channel Index
> 0 bullish
0 > bearish
> 100 extremely bullish
-100 > - extremely bearish
RSI(14) 14 day Relative Strength Index
> 50 bullish
50 > bearish
> 70 overbought
30 > - oversold
MACD ? - MACD slope (MACD MACD[1])
> 0 bullish
0 > - bearish
Mom(8) 8 day Momentum (shorter-term direction)
> 0 bullish
0 > - bearish
ATR(14) 14 day Average True Range (volatility)
Medium 75th percentile* > ATR(14) > 25th percentile*
High - > 75th percentile*
Low 25th percentile* >
ADX(14) 14 day Average Directional Index (directional strength)
> 30 strong
30 > - weak
*measured against past 3 months
