Potential support for the EURUSD begins at 1.4280 and extends to 1.4200. This range encompasses strucutural support as well as Fibonacci support.
Euro / US Dollar
Last week’s break above 1.4340 confirmed that wave v of C is underway towards 1.4720. Since the breakout, the EURUSD has been stationary, trading in a 1.4450-1.4350 range. The trend remains strong to the bull side against 1.4000 but a setback to 1.4200/80 is possible near term
British Pound / US Dollar
Cable’s consolidation since the beginning of June is not as clear as the EURUSD triangle. In fact, the pattern could have been an irregular flat in which wave b exceeds the origin of wave a and wave c fails to extend beyond the origin of wave b. In any case, the GBPUSD should make its way higher as the EURUSD extends above 1.4720. The next measured objective is 1.7250. 1.6680-1.6780 is support.
Australian Dollar / US Dollar
The AUDUSD has broken above its June high, confirming that wave C (as well as the entire rally from the October low) is in its final stages. The AUDUSD may extend as high as the channel resistance line over the next several weeks. Only a decline below .8120 would suggest that a top is in place.
New Zealand Dollar / US Dollar
The NZDUSD is in the same position as the AUDUSD. The break to a 2009 high indicates that wave v of C is underway. Although anticipating a reversal, there is no evidence of one yet. Potential resistance is at .6958. Only a drop below .6467 would suggest that a top is in place.
US Dollar / Japanese Yen
The USDJPY has failed to accelerate lower, thus it is more likely that the decline from 101.50 is corrective, just as the rally from 87.10 is corrective. In other words, everything from the 2009 low is a correction and will eventually be retraced, but not before a push above 101.50. With the last number of weeks’ trading taking place close to the 200 day SMA, an upside break looms on the horizon.
US Dollar / Canadian Dollar
The entire rally from 1.0782 has now been retraced. Additional weakness is expected over the next several weeks in order to complete the decline from 1.1730 and by extension the entire decline from 1.3068. 1.0588 is the next level of potential support (Fibonacci). The drastic divergence with RSI at the recent low warns of a strong rebound and potentially an outright reversal.
US Dollar / Swiss Franc
Sticking with the USD bearish count, expectations over the next several weeks are for a thrust lower that ends below 1.0367. Bears are favored against 1.0939 and 1.0037 is a potential target (100% extension of 1.2303-1.0367). 1.0738 is potential resistance.
British Pound / Japanese Yen
The underside of a former support line is now serving as resistance as the GBPJPY approaches the June high of 162.64. A break above the line is expected eventually since the decline from that level is in just 3 waves. Initial support is 159.00 (38.2% of rally from 153.84).
Jamie Saettele publishes Daily Technicals every weekday morning (930 am EST), COT analysis (published Monday mornings), technical analysis of currency crosses throughout the week (EUR on Tuesday, JPY on Wednesday, GBP on Thursday, AUD on Friday), and the DFX Trend Index every day after the NY close. He is also the author of Sentiment in the Forex Market. Follow his intraday market commentary at DailyFX Forex Stream.
Please send comments about this report to [email protected]
