Currency Crosses: Technical Outlook 09-03

Long Term Trends and Pivot Points (monthly data) (updated on first of the month)

Medium Term Trends and Pivot Points (weekly data) (updated every week)

Euro / British Pound

Daily Bars

Prepared by Jamie Saettele

I’ve been waiting for a drop towards 7700 in order to complete a large 4th wave correction. However, the June low has held for several months and the decline from the top (2008 high) sports 2 equal legs. This rally appears to have legs and support is at 8250/75. In the coming weeks, a move above the red line would signal that a 3rd wave is underway towards 8900/9000.

Euro / Canadian Dollar

Daily Bars

Prepared by Jamie Saettele

“5 waves up in the EURCAD from the June low indicate that the trend is up from that level. Waves a and b of an a-b-c correction are probably complete. Allow for a drop below 13150 in wave c. 12950 is support. Look lower from here.”

Euro / Australian Dollar

Daily Bars

Prepared by Jamie Saettele

“The EURAUD appears to have traced out a triangle from the May low. Triangles are typically followed by terminal thrusts in the direction of the larger trend (the ‘terminal’ thrust completes the larger trend). Given the extent of the triangle (at least 3 months), the thrust lower will probably be significant. The classic triangle measuring technique (extend the widest part of the triangle from the breakout price) does not project a low until 12500.”

Euro / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

The EURJPY may have found an important low at 10540. The 5 wave pattern is visible from the October 2009 high. Expectations are for a correction higher (which could be sharp) to at least 11500 and perhaps close to 12000 over the next 4 to 6 weeks. Near term, price has broken higher from a small triangle (terminal pattern) so there is the possibility of a move back to 10740 before strength resumes.

British Pound / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

The GBPJPY decline from its 2009 high is contained within a well defined channel. The GBPJPY has failed to take out its May low, which creates a divergence with the EURJPY that often attends important turns (this is true with the CADJPY and AUDJPY as well).

Canadian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

The CADJPY has reversed from the 100% extension of the 9450-8240 decline. A move through 8200 would shift focus to 8500. 8020 and 7970 are supports.

Australian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

Since the May low, the AUDJPY has traded sideways in what is probably the first 2 segments of a 3 wave correction (wave a as a flat and wave b as a triangle). The triangle is either complete or close to complete and price should stay above 7450. Support is at 7610.

Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Monday), technical analysis of currency crosseson Wednesday, and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates at the DailyFX Forum. He is the author of Sentiment in the Forex Market. Follow his intraday market commentary and trades at DailyFX Forex Stream. Send requests to receive his reports via email to jsaettele@dailyfx.com.