Currency Crosses: Technical Outlook 03-10
The EURGBP should continue higher and trade above 9153 in order to complete 5 waves up from 8656. That rally could complete 3 waves up from 8599 and wave D of a triangle that has been underway since December 2008 (last day of that month). 9200 is potential resistance as is 9244.
Euro / Canadian Dollar
The EURCAD remains well within its bearish channel. Until a break of a pivot high, it is dangerous (if not foolish) to go long. The bullish pivot is 14155. The next significant price level on the downside is not until the 2007 low at 13284.
Euro / Australian Dollar
Near term, the EURAUD may be completing a diagonal from 15331. The bounce from 14804 would be wave 4 and 14960-15014 may serve as resistance. If this count is correct, then the pair would roll over near there and drop to a new low. Only a move above 15208 would indicate a reversal at this point.
Euro / New Zealand Dollar
After dropping to a 2 year low, the EURNZD has popped nearly 300 pips. Still, the pair has been basically in a range since mid January and only a move above 20077 would clear the top of the range. 19532-19600 is potential resistance. The next major downside level is 18181 (2008 low).
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. 12575 is a measured level (100% extension of the rally from 11963). Near term support may be at 12320.
British Pound / Japanese Yen
The larger trend is down but the GBPJPY is consolidating recent losses. Expect resistance from trendline/channel resistance either late this week or early next week. The pair could exceed 13743 in order to complete a flat or remain below and form a triangle.
Canadian Dollar / Japanese Yen
Expect some consolidation, followed by a new high. Levels to watch for a reversal are 8930 (100% extension of 8235-8851 rally) and 9032 (100% extension of 8314-8655 rally). Watch the top of the channel line for resistance as well.
Australian Dollar / Japanese Yen
The AUDJPY is in the same position as the CADJPY. The pair may see additional strength before finding a more meaningful top. Levels to watch for a reversal are 8389 and 8484. A break of short term trendline support would suggest that a top is in place.
New Zealand Dollar / Japanese Yen
It remains possible that a top is in place for the NZDUSD. A drop below 6244 would confirm as much. However, additional strength in a larger correction cannot be ruled out. 6541 would be resistance.
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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