[B]Commentary [/B]- Our count is tracking well so there is no reason to change our outlook. We are treating the rally from .8746 as wave X in a more complex correction from .9514. We favor this view because the rally from .8749 is not a clean 5 wave impulse that would typically signal the beginning of a 3rd wave. Wave Y should be underway now and we expect the pair to drop below .8746 in order to complete larger wave 2 in the next several weeks. A rally above .9514 would signal that wave 3 is underway and signal the return of the longer term bull market.
[B]Strategy [/B]- Waiting for wave 2 to finish below .8746 so that we can align with wave 3 higher
[B]Commentary [/B]- The AUDJPY has come off of the 107.70 high made last week to test a support line drawn off of the 6/27 and 7/11 lows. The decline from 107.70 to 105.35 remains corrective in nature so upside potential remains. However, that decline may very well be the first leg lower in a more complex correction. Coming under 105.35 would suggest that this is the case. The next level of potential support would be the parallel channel support near 104.00.
[B]Strategy [/B]- Flat
[B]Commentary[/B] - We wrote last week that “the near term structure is bullish as long as price is above 1.0906. A break above 1.1124 indicates additional bullish potential.” The AUDNZD dipped below 1.0974 in what was likely wave c of a correction. 1.0906 remains key to the bullish case (preferably 1.0910). Near term support is at 1.0964. We are looking higher.
[B]Strategy[/B] - Remain bullish, against 1.0906, target break above 1.1124.