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The EURUSD is quietly building a base that will likely lead to Euro strength accelerating in the days ahead.

This is my favored count, which is quite bullish.  I am treating the advance from 1.3257 as a series of 1st and 2nd waves.  This count is valid as long as price is above 1.3485.    If needed, look for support near 1.36 (61.8% of 1.3485-1.3773 is at 1.3594). 

I wrote yesterday that “the USDJPY decline from 108.07 is in 5 waves so a pullback is likely underway towards at least 101.65.  102.85 seems more likely given that this is the 50% and former congestion.  We’ll look to identify the completion of the corrective rally in the days ahead.”  Resistance has been strong near the mentioned level so it is possible that the larger decline continues.  A larger correction could test the 61.8% at 104.

The rally from 1.6775 is an impulse.  If a corrective decline unfolds, then we’ll have the opportunity to get bullish for a larger advance in wave 3 (or C).  Initial support is at 1.7412.

5 waves up from 1.0686 and 3 waves down to former support is bullish for the USDCHF.  The alternate is still bullish, but the next leg up advance would not occur until a drop below 1.1125 that completes a larger correction from 1.1493.    

The USDCAD drop from 1.2132 has held short term trendline support.  A closer look at the decline reveals that it is an impulse though and that the line will most likely be broken.  Near term, expect an advance into the Fibonacci zone (1.1612-1.1808) before weakness resumes.

The AUDUSD advance from .6326 is in just 3 waves to this point, leaving the AUDUSD vulnerable to weakness and a drop below .6326.  However, it is still possible that a 5th wave does take hold from near current price and completes an impulse sequence.  Target 1 was hit at .7150 and target 2 at .74 remains a possibility.  Move risk to .6790.  

The minimum objective of below .5927 has been reached.  The outlook is the same for the NZDUSD as for the AUDUSD; expect the recovery that began last week to continue for weeks, if not much longer.  A return to .70 is reasonable.

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.