A EURUSD rally through 1.4710 would present a short term bullish opportunity against 1.4630. Just shy of 1.50 would be an initial bullish objective.
On the hourly, there are 5 waves down from 1.6039. Even more indicative of a near term bottom is that wave 5 is in 5 waves as well (circled…but not labeled). Also not shown (but is supportive of at least a near term low) is bullish divergence with oscillators and extreme bearish sentiment. A push through 1.4710 would be enough to convince us that at least a short term low is in place. The initial bullish objective would be just shy of 1.50.
We discussed the [short term USDJPY structure](301 Moved Permanently term http:/www.dailyfx.com/story/bio2/Forex_Technicals__The_Day_Ahead__1219093789732.html) in last night’s technical update and so far, the pair is following the preferred short term path. Support should be strong down to 109.23. As long as price is above 108.36, it is our contention that wave C of a second zigzag within a double zigzag from 95.72 is underway towards 116-118.
Cable continues to consolidate just above the 1.85 figure. Measured support from the 100% extension of 2.1160-1.9337-2.0396 at 1.8573 and the 61.8% of 1.7047-2.1160 at 1.8618 should lead to a bounce from near current price. Also, extending a line parallel to the line drawn off of the November 2007 and July 2008 highs from the January 2008 low provides potential channel support.
The USDCHF is approaching the top of a congestion area from earlier in the year. The area should provide some resistance to additional gains. The top of this area is roughly 100 pips above today’s high (so far). Near term, coming under 1.0911 would make it likely that at least a short term top is in place and that a larger USDCHF decline is underway (back to at least 1.0742).
Bigger picture, we are looking for a top (but probably after a push through 1.0726). The recent advance was a break from a triangle. Triangles occur as the middle wave of 3 wave corrections. So, if we are correct in our labeling above, the USDCAD should form a top soon…1.08 is the 61.8% of the 1.1875-.9055 decline and a potential resistance area.
The AUDUSD continues to consolidate near its recent low. The consolidation is probably a 4th wave triangle that will give way to a 5th wave terminal thrust. Expect a new low, below .8591. The psychological .85 level is potential support.
The NZDUSD countertrend advance is much more mature than the other USD pairs (some of which may have not even started countertrend advances). In fact, the pair is already near the Fibo zone, which begins at .7182. Look for resistance near there.
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