British Pound Crosses Mostly Bearish

The GBPCHF is heading towards parallel channel support in what may complete a 5th wave within a 5 wave drop from 2.50.  The pair has already dropped to an all-time low so the next level of support would be parallel channel support, which is at 1.68 next week (decreases about 50 pips per week). 

Near term, the GBPCAD may push through 1.9260 to test measured resistance at 1.9600/50.  This is the 100% extension of the rally from 1.7890 as well as the 61.8% of the drop from 2.0750. 

The long term trend is considered down.  The spike high to 2.7110 in early October probably completes wave B of a long term A-B-C decline that began in 2001.  The minimum long term target is below 2.0291.  Favor the downside near term as long as price is below the resistance line that has held since October 8.

A 5 wave drop is clear in the GBPNZD (from 2000 to 2005).  Sideways trading since then could be taking the form of a B wave.  This outlook favors range traders for at least the next several months.  Near term, price may be headed lower to test the triangle support near 2.50.

Jamie Saettele writes Forex Technicals: The Day Ahead, Monday-Thursday (published at 6 pm EST), Daily Technicals  every weekday morning (9 am EST), COT Analysis (published Monday mornings), and analysis of currency crosses throughout the week.  He is also the author of Sentiment in the Forex Market.