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Aside from the British Pound dropping to a yearly low against the US dollar, nothing has happened over the last 24 hours to alter the short term technical outlook.  The dollar may still decline from here.

There is no change to the EURUSD analysis for now.  “I am sticking with the triangle pattern.  Triangles consist of 5 waves, a-b-c-d-e.  If a triangle is underway, then wave e is underway now (possibly complete at 1.2772) and will end as a spike above 1.2772.  Resistance begins at 1.28 and extends as high as 1.30.” 

As long as price remains below 96 (below the resistance line from early October), bearish potential is significant (below 80).  Another reason to stay bearish is that the USDJPY is not ‘acting’ as it has at recent bottoms.  Turns usually occur with a price spike (notice indicator on chart).  There has been no spike recently in the USDJPY, which tells me that a bottom is not likely to form soon.    

Cable dropped to a new low (below 1.4554) but a pullback may be underway to 1.50 or so.  Looking in at the hourly chart, the GBPUSD rally from 1.4554 is clearly corrective.  While this could be the beginning of a flat or triangle, it may also be a completed correction at 1.5539 that will lead to new lows.  Further, the decline from 1.5539 counts well as an impulse.  A rally back to former resistance at 1.5073 would potentially complete wave ii within the bear cycle from 1.5539.  This scenario fits well with a EURUSD rally in wave e before resumption of weakness. 

Higher highs and higher lows since the March low favors bulls longer term.  Near term, the decline from the top side of the channel is impulsive and the rally from 1.1828 is corrective.  Expect weakness below 1.1828 in the next several weeks.

There is no change to the USDCAD bearish bias as price remains below 1.2993.  “The rally from just below 1.15 is in 5 waves and could be a truncated 5th wave.  If so, then a correction back to at least 1.15 and possibly lower is underway now.  The drop from 1.2993 to 1.2120 is in 5 waves, which is bearish.  Price should remain below 1.2993.”

The AUDUSD has market time for the past 3 days but there is no change to the bullish bias.  “There remains potential for a large recovery back to the mid .70s given the 5 wave drop from the top (waves a and b of an a-b-c correction would be close to complete).  Bulls may attempt to ‘pick’ this bottom given that the AUDUSD has held above the October low.”

The NZDUSD is making an attempt at forming a bottom.  “There is quintuple divergence with RSI on the daily NZDUSD chart, which warns of a reversal.”  Staying above .5186 keeps the bullish potential intact.  A move through the resistance line drawn off of the September and November highs would confirm a reversal. 

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.