The EURNZD has rallied through 7 month trendline resistance and focus is now on 2.0750. The Yen crosses have fallen rapidly from recent highs and the larger bullish patterns are in question.
Euro / British Pound
The EURGBP fell below .8985 but the decline may still be a 4th wave correction (I still favor a 5th wave advance through .9416 and maybe .9807). Levels that could offer additional support are the 50% retracement of wave 3, which is at .8934 and the wave i of 3 high at .8843. Coming below .8703 would signal that the larger trend is probably down.
Euro / Swiss Franc
“There is little to say about the EURCHF technically and there will not be until the pair breaks from the triangle. The fight between bulls and bears wages on in a triangle that has been underway since October. Triangles are typically continuation patterns, so a downside break seems more probable. Still, forecasting is an exercise in probabilities rather than certainties so jump the gun at your own risk. Pushing through either the top of bottom line triangle line would present a breakout opportunity.” The triangle count shown above is bearish but a bullish outcome is possible too. Wave a would be A and wave B would be a triangle.
Euro / Canadian Dollar
A head and shoulders top has been unfolding since January 2008. The left shoulder was complex with 2 shoulders. H&S patterns tend towards symmetry and I suggested last week that the EURCAD would rally to 1.6330 in order to form another right shoulder. This scenario remains on track.
Euro / Australian Dollar
We viewed short term price action last week and concluded that “a rally above 1.6310 would break a series of lower highs, at least in the short term. This would be the first sign of a bottom.” The EURAUD did break higher and strategy is to now buy dips. Support is 1.6310 and then 1.6240.
Euro / New Zealand Dollar
Last update was that “the EURNZD has bounced from a downward sloping line extended from the 6/22, and 8/14 lows (line also cuts through 3 days this month). RSI has not confirmed the low (divergence), which leaves the downtrend weak technically and at risk of reversing.” The EURNZD blasted through the multi month resistance line today, confirming a reversal. Look to buy dips. Support is 2.0240, 2.0110, then 2.0000.
Euro / Japanese Yen
Despite the significant decline in such a short amount of time, focus remains on the larger triangle pattern. The next level of potential support is just above 132. It certainly is possible that the rally from 129 is the last leg of strength that this pair sees in some time and that action since the Spring is distributive. Whichever way the EURJPY decides to break in the coming weeks/months, the move should be substantial.
British Pound / Japanese Yen
The larger pattern depends on how the price pattern in the circled area is interpreted. Treating that as a triangle and 5th wave thrust would indicate that the 5 wave rally from 139.68 is wave A of an A-B-C correction. Treating the circled area as wave A and B of an expanded flat would indicate that the 5 wave rally is wave C and that a corrective rally is over. The bigger picture is unclear but 147.05 is support (both structural and the 100% extension of 153.30-149.13. 149.60/80 is resistance.
Swiss Franc / Japanese Yen
The CHFJPY exceeded its 2009 high (barely), which was 91.56. This fact should not be overlooked because the EURJPY failed to exceed its high (139.17). This sets up a possible non-confirmation and potentially significant downside reversal. Nothing is confirmed at this point of course. 87.20 is potential support.
Canadian Dollar / Japanese Yen
I am unsure of the action since early June but a triangle (similar to the EURJPY but lagging) could be unfolding. The pair has dropped into a congestion area defined by 83 and 84.30. Expect support at the lower end of the range.
Australian Dollar / Japanese Yen
I am unsure of the action since early June but a triangle (similar to the EURJPY but lagging) could be unfolding. The pair has dropped into a congestion area defined by 83 and 84.30. Expect support at the lower end of the range.
New Zealand Dollar / Japanese Yen
The NZDJPY reversed from a line drawn off of January, April, and June highs and is now testing channel support / that has held since the low as well as the 50 day SMA. The battle lines are drawn. Points to expect resistance are 66.60, 67.10, 67.60, and 68.05.
Written by Jamie Saettele
Friday, October 30, 2009 | 0
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