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Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

By , Sr. Technical Strategist
29 March 2013 18:05 GMT

Near term action continues to favor GBPUSD longs and AUDUSD shorts. EURJPY and ZARJPY are holding support ahead of BoJ, which could trigger a run at the highs (although I’m then looking for failure).

GBPUSD

Daily

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_gbpusd.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

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FOREXAnalysis: Near term, the GBPUSD hold at 1.5100 is a positive development so there is clearly no reason to alter the bullish outlook. Resumption towards the congestion area that preceded the sharp 2/20 drop is favored. The lower part of that zone (1.5415) is also the 38.2% retracement of the decline from the January high (1.5423). IF the rally continues from above 1.5092, then the advance would consist of 2 equal legs at 1.5521, or near the top of the zone (1.5549).

FOREX Trading Strategy: Risk for traders should be moved up to 1.5090 (bias is bullish above 1.4830 though). If 1.5090 fails to hold, then 1.5045 and 1.4994 are estimated supports. Pay attention to the London open if trading GBPUSD.

AUDUSD

Weekly

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_audusd.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

FOREXAnalysis: “The reversal at the 78.6% retracement and subsequent drop below Monday’s low is a good start for a drop into at least 1.0305/45.” The downside remains favored until at least 1.0300 (former resistance and 50% retracement) for the next few weeks although it’s possible that this move is the beginning of something ‘bigger’….don’t forget that price remains within the triangle that began at the 2011 high.

FOREXTrading Strategy: Short, stop on daily close above 1.0500, target 1.0310. RBA is a market mover on Monday.

EURJPY

Daily

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_eurjpy.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

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FOREXAnalysis: The major trend is up and minor trend is sideways/down. Understand that additional sideways/down prices are likely until late stage bulls are cleared out. Major support is estimated at 116.00-117.00 (117.00/25). 115.95 is the 1/2 high, and 117.00/25 is marked by the 1/23 low and the 38.2% retracement of the rally from the November low. Near term, the EURJPY is holding important support defined by the 2/25 large range close (119.91).

FOREX Trading Strategy: It’s possible that the larger bull trend begins from here instead of 116.00-117.00 so looking to go long next week (need to see a hold of today’s low first) but would expect resistance at 123.60-124.50.

ZARJPY

Daily

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_zarjpy.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

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FOREXAnalysis: ZARJPY has corrected into late January levels. Bigger picture, the clean 5 wave advance from the October 2012 low argues for a major multiyear bull market. Calling the end of a correction is always difficult but near term upside is favored towards the top of the channel with price holding Monday’s low for the week. Minor resistance is estimated at 10.350.

FOREX Trading Strategy: It’s possible that the larger bull trend begins from here instead of major support at 9.888 so looking to go long early next week but would expect resistance at 10.4205-4810.

AUDJPY

240 Minute

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_audjpy.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

FOREXAnalysis: One reason to be wary of the longer term trend in Yen crosses resuming from the current level is the AUDJPY. The March high 99.97 is in line with the 1997 high at 100.05 (see below chart). The level is reinforced by the channel that defines the advance from the 2008 low (channel is just above price). Near term, there is of course room for a bounce into 98.68 and perhaps consolidation before another high…just don’t get carried away with thoughts of another huge move (not yet at least)….not with the 1997 high, 4+ year channel and round 100 figure in the way.

FOREX Trading Strategy: This is the best Yen cross to short (in my opinion). I’ll be looking for short setups next week. In general, look for a failed rally above 99.00. Keep an eye on the economic calendar; RBA is Monday.

AUDJPY

Weekly

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_audjpy_1.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

EURUSD

240 Minute

Trading_Opportunities_in_GBPUSD_AUDUSD_and_Yen_Crosses_body_eurusd.png, Trading Opportunities in GBP/USD, AUD/USD, and Yen Crosses

Chart Prepared by Jamie Saettele, CMT using Marketscope 2.0

Are you new to FX or curious about your trading IQ?

FOREXAnalysis: Did the ‘initial resistance line’ mentioned earlier this week nail the low? It’s too early to tell but the inside day is a good start. “The EURUSD diagonal count I’ve been tracking since 1.3133 is coming into sharper focus. The diagonal line crosses about 1.2665 on Friday. This is in line with the November low at 1.2660 and 61.8% retracement of the rally from the July 2012 low at 1.2679. Of note as well is the initial trendline from the high above 1.3700. That line has come into play as a pivot many times in the last several months.” It’s worth noting that next week is heavy with event risk.

FOREX Trading Strategy: In order to turn bullish, need to see price fall into 1.2660/80 and reverse or exceed 1.2890 from current levels.

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

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

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Jamie is the author of Sentiment in the Forex Market.

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29 March 2013 18:05 GMT