Short Forecasts for Pound, Yen Crosses
The GBP/JPY cross pair from the weekly perspective is still in consolidation mode. Last week price was at 144.58, currently price is at 144.43. The big picture of this pair is still in the downside bias. We have an “M” pattern where the first leg is the leg buy, and now leg 2 is coming back into play for sell signal as noted on the chart. The target leg is at 135.00 for a 6 month outlook after a break out of this consolidation. MACD is neutralizing to the waterline to gain momentum for another drop to the south side. While in consolidation we will target 100 pip moves.
The pair GBP/CAD on last week’s chart was 100 pips lower. This is still in consolidation mode as well. Looking at the chart we have resistance on the chart at fib level .250 since January 2010. The downtrend continuation pattern is still in tact as we are still in sideways mode here waiting for a break out. The sideways range the past couple weeks have been 150 pips. Leg 2 will become a sell signal once a break of the 1.5175 level is complete. The first target is 1.4851, second target 1.400. While in consolidation we will target 100 pip moves.
Aud/Jpy completed is in the same boat as the other cross pairs with the consolidation in common. Looking at this weekly chart we have resistance 88.33 and support 75.41. MACD is starting to diverge and with the resistance holding we still are bearish inside the consolidation. Leg 2 will start to form targeting the first area at the .618 fib level, 83.39, then target # 2 with price action at 80.95. Until we have a break out, we are going to be on this “yo yo” pattern of support and resistance. We will look to trade in 50-100 pip targets at a time.
Written by Erica Villalon, Traders International
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