Reversal Opportunities for EURJPY and AUDCAD

Euro / Japanese Yen

60 Minute Bars

Prepared by Jamie Saettele, CMT

Last week’s comments were that “5 wave counts from 10162 and 9737 are valid for the EURJPY. In other words, a countertrend move back to at least 9737 (4th wave of one less degree) may be underway.” The EURJPY reached 9732 and the impulsive (5 waves) nature of the advance from 9410 suggests that another bull leg is around the corner. The decline from 9732 has unfolded in 3 waves with waves a and c nearly equal. Additional support is 9465. Exceeding 9560 would increase confidence that a low is in place. 9814/32 is an objective.

Australian Dollar / New Zealand Dollar

240 Minute Bars

Prepared by Jamie Saettele, CMT

The AUDNZD traced out a key reversal last week (previous 2 key reversals were the weeks that ended 12/16/11 and 4/13/12). Price action from the 13078 high, 5 waves down and a pop into the former 4th wave just above 13000, is bearish as well. Look lower towards the 100% extension of the decline from 13078 at 12840.

Australian Dollar / Canadian Dollar

Daily Bars

Prepared by Jamie Saettele, CMT

The AUDCAD is setup for a sharp reversal. The rally from 10277 is at risk of being fully retraced and quickly as the advance from the level has unfolded as an ending diagonal (today’s poke above the upper diagonal line constitutes a throwover). The advance from the 5/23 low divides into Fibonacci proportion (wave c = 61.8% of a) and the 2/22 low (former support) reinforces resistance just above today’s high.

Euro / British Pound

Daily Bars

Prepared by Jamie Saettele, CMT

At first glance, the advance from 7751 is a clean 3 wave and therefore corrective advance. However, a look at longer term technical information reveals that turning bearish at the current level poses more risk than reward. A key reversal unfolded last week after price registered the lowest level since October 2008. I’m not willing to fight a reaction off of such an important level. A constructive view is warranted against 7750 towards 7950 and 155.

--- Written by Jamie Saettele, CMT, Senior Technical Strategist for DailyFX.com

To contact Jamie e-mail jsaettele@dailyfx.com. Follow me on Twitter @JamieSaettele

To be added to Jamie’s e-mail distribution list, send an e-mail with subject line "Distribution List" to jsaettele@dailyfx.com

Jamie is the author of Sentiment in the Forex Market.

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.