AUDCAD
AUDJPY
AUDNZD
Commentary – We remain long term bulls of the AUDCAD and a bullish bias is warranted against .8510. We wrote last week that “wave ii of 3 of larger 1 is underway now and we are expecting it to bottom near the 61.8% of .8510-.8892 at .8656. A drop to this level presents an opportunity to jump aboard what should be an exciting ride.” The pair did drop to .8639 yesterday and support has held so far. Still, the bullish bias is strong as long as price is above .8510.
Strategy – Longer term bullish against .8510, targets .9681 and 1.053
Commentary – We wrote last week that “a push through 105.77 is expected to complete 9 waves up from 92.20 (9 waves is a derivation of 5….whether 1,3,or 5 is extended does not matter…all we know is that one is extended). The high should prove marginal and give way to a corrective decline…” The push higher ended at 106.88 but the decline that has occurred does not look corrective. A 5 wave decline is visible on the hourly, and a flat correction followed. Therefore, a bearish bias is warranted against 104.92 (where the expanded flat correction ended). At this point, bearish targets are 100.81 and 98.28 (100% and 161.8% extensions of 106.88-102.77/104.92).
Strategy – Bearish against 104.92, targets 100.81 and 98.28.
Commentary – We wrote last week that “because it is possible that the rally from 1.1592 is unfolding as a series of 1st and 2nd waves, remain bullish against 1.1605.” That proved to be correct as the rally has accelerated in a 3rd wave. Price should exceed 1.2031 soon and it is our contention that price is headed above 1.2448 in the next few months. Price should remain above 1.1637.
Strategy – Remain bullish, move risk to 1.1637 (from 1.1605), targeting above 1.2030 (and much higher)
Written by Jamie Saettele, Technical Currency Strategist for DailyFX.com