Currency Crosses: Technical Outlook

Currency Crosses: Technical Outlook

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

Weekly Candles

Prepared by Jamie Saettele

The EURGBP has plunged from its recent high and a look at the weekly warns that the high may not be exceeded for a while. Price reversed not only at the 100% extension level but also at a long term resistance line. This week will end as a key reversal and bearish engulfing pattern. Intraday oscillators are divergent with the new low which warns of a move back to 8775.

Euro / Canadian Dollar

Weekly Bars

The EURCAD has reversed just shy of the long cited level of 14380 (100% extension of the rally from 12446). The corrective channel and 100% extension are a strong impediment to additional gains. Weekly RSI is reversing at 60, which is typically the upper boundary for the indicator in a bear market. RSI divergence on the daily favors a topping scenario as well.

Prepared by Jamie Saettele

Euro / Australian Dollar

Weekly Bars

Prepared by Jamie Saettele

The EURAUD has held above its long term channel for several weeks now but failed to progress. Until price can sustain a break above 14380, the EURAUD is vulnerable. In the event of weakness, watch 13920 for support. With both the EURGBP and EURCAD showing signs of weakness, consider the possibility of additional weakness for the EURAUD in a 5th wave towards 13240 (wave 5 = wave 1).

Euro / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

The EURJPY slipped below 11145, which leaves the rally from the low (10541) in 3 waves (and probably wave A of a large corrective pattern). Expectations over the next several weeks and probably month + are for sideways / downside action. 10960 is initial support, followed by 10540. Keep in mind that if a flat is underway, then the entire decline will be retraced in wave B.

British Pound / Japanese Yen

Weekly Bars

Prepared by Jamie Saettele

Despite this week’s reversal, the GBPJPY may work lower still in wave B of a triangle or flat. To review, the drop from 16315 is clearly not an impulse but neither is the rally from 11880. A triangle or flat may be underway here from the January 2009 low. In either case, an initial objective is probably 15500 (the monthly key reversal bolsters this bullish outlook).” The reason to question the immediate upside potential is the EURJPY 3 wave rally and the inability of the USDJPY to sustain any sort of rally for more than a few days. 130 is potential resistance early next week.

Canadian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

The CADJPY is holding just above the August low and the decline from 9450 is in 2 equal legs. Still, only a move above the resistance line would shift focus to the upside. Until then, price remains vulnerable. Under 7840 would shift focus to 7625 and then 7500.

Australian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele

7870 failed to hold so the thrust higher from the triangle may be complete. Watch the short term channel for resistance. Price coming under the channel (and RSI coming under its trendline) would signal a likely acceleration of the decline towards 7500.

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.