Currency Crosses: Technical Outlook 03-08
I wrote Friday that “consolidation/pullback is underway in a 4th wave. Support should be strong down to 8950. After finding bottom, the EURGBP is expected to make a new high (above 9153).” A 4th wave low may be in at 8980. Favor the upside. 9200 is potential resistance as is 9244.
Euro / Canadian Dollar
The EURCAD remains well within its bearish channel. I mentioned Friday that “the pair is attempting another key reversal and RSI divergence remains. Until a break of a pivot high, it is dangerous (if not foolish) to short. The bullish pivot is now lowered to 14155. The next significant price level on the downside is not until the 2007 low at 13284.” There is no change.
Euro / Australian Dollar
The EURAUD made an inside day today as price is testing a downward sloping support line (drawn off of the 6/11/09, 10/19/09 lows). The line has crossed through 6 days of price action in February and March, which denotes the important of the line. A move above 15331 would signal a reversal. Until then, the larger trend remains down.
Euro / New Zealand Dollar
The EURNZD exceeded channel resistance momentarily last week but is back below now. Rallying above 20077 would confirm a short term double bottom just above 19257.
Euro / Japanese Yen
The EURJPY has held its February low and the break above 12193 exposes 12528. Although far from clear, the decline from 13853 can be counted as a 5 wave decline (first wave is a truncation). This would portend a move back to at least 12528 and possibly 12745. 12240/60 is short term support.
British Pound / Japanese Yen
The GBPJPY has rallied from trendline support and is approaching the 2/5 low of 13822. Trendline resistance is at 13960 on Tuesday and decreases about 30 pips per day. A sustained drop below 13500 would begin to put bears back in control.
Canadian Dollar / Japanese Yen
This is the count that I’ve been following for weeks but it is in jeopardy of invalidation now. I have been viewing the “decline from 8850 as wave i of the next 5 wave decline.” 8850 is clearly at risk now and a move above would shift focus to 8937. The bigger picture bearish outcome remains possible as long as price is below 9065 (8937 potential resistance). A drop below 8650 would signal that a top is probably in place.
Australian Dollar / Japanese Yen
Same deal as CADJPY: I have been viewing the “decline from 8284 as wave i of the next 5 wave decline.” 8284 is clearly at risk now and a move above would shift focus to 8350-8440. The bigger picture bearish outcome remains possible as long as price is below 8625 (7440/85 is potential resistance). A drop below 8086 would signal that a top is probably in place.
New Zealand Dollar / Japanese Yen
The NZJPY is in the same position as the AUDJPY. I have been viewing the “decline from 6456 as wave i of the next 5 wave decline.” Rallying through 6456 would shift focus to 6500-40 then 6650.
Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Friday evenings), technical analysis of currency crosses on Monday, Wednesday, and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates at the DailyFX Forum. He is the author of Sentiment in the Forex Market. Follow his intraday market commentary and trades at DailyFX Forex Stream. Send requests to receive his reports via email to firstname.lastname@example.org.
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