The AUDNZD and AUDCAD should accelerate in coming weeks, eventually reaching multi-year highs. On the other hand, the AUDCHF may be about to enter a 3rd of a 3rd wave lower.
We wrote last week that “the rally from .9279 to 1.0823 (ended on November 1, 2007) was probably the final bull run for ‘risk’ for at least a few years. The drop from 1.0823 was a 5 wave decline, indicating that the larger trend is down.” We were looking for a push through 1.0137 in order to complete an expanded flat but that appears very unlikely at this point. As such, the next best count treats the drop from 1.0135 (near 200 day SMA) as wave iii of larger 3 from 1.0823. If this is correct, then the pair should accelerate lower.
The AUDCAD rally from .8119 to .9514 was in 5 waves and the decline to .8271 was clearly a 3 wave correction. Therefore, .9514 is expected to give way to a new high eventually. A measured objective is where the rally from .8271 would equal the rally from .8119 to .9514; at .9670. Near term weakness has presented an opportunity to get bullish against .8783.
With 5 waves up from 1.0906 to 1.2031 and with 3 waves down from 1.2031, the AUDNZD is expected to eventually exceed 1.2031. The rally should continue and possibly accelerate with 1.1371 remaining intact. Ideally, price doesn’t even come near there though.
[B]Tell us what you think about this report: contact the strategist about the article at <[email protected]>[/B]
[B] [B]TREND ANALYSIS[/B] is based on a rolling pivot model. LONG TERM TREND is determined by the last 3 months of price data (high, low, close). SHORT TERM TREND is determined by the last 4 weeks of price data (high, low, close). R3, R2, R1, PL, PH, S1, S2, and S3 are provided to aid in identifying entries and exits. These are objective measures and our subjective analysis (STRATEGY) may differ.
[B]SCHEDULE[/B]
Monday: EURJPY, GBPJPY, CHFJPY, CADJPY, AUDJPY, NZDJPY
Tuesday: EURGBP, EURCHF, EURCAD, EURAUD, EURNZD
Wednesday: GBPCHF, GBPCAD, GBPAUD, GBPNZD
Thursday: AUDCHF, AUDCAD, AUDNZD
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