AUDCAD
AUDJPY
AUDNZD
Commentary – We remain long term bulls of the AUDCAD and a bullish bias is warranted against .8510. The reason for our long term bullish stance is the clear 5 wave rally from June 2006 to April 2007 and the subsequent 3 wave correction into the August 2007 low. Near term, the pair appears to be tracing out a series of 1st and 2nd waves (as labeled).
Strategy – Longer term bullish against .8510, targets .9681 and 1.0531
Commentary – We wrote last week that “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). Our first target was hit at 100.81 as price dropped to 99.35. However, the rally that has followed is impulsive, suggesting additional upside potential. That makes the decline an a-b-c correction and suggests that 106.88 will be exceeded. A cautious bullish bias is warranted against 101.85 for a test of 106.88.
Strategy – Bullish now, against 101.85, target 106.88
Commentary – We wrote last week that “price should exceed 1.2031 soon and it is our contention that price is headed above 1.2448 in the next few months.” The pair reached 1.1980 today and the internal structure remains bullish. Short term support is at the 38.2% of 1.1821-1.1980 at 1.1919 and the 61.8% at 1.1882. Price should remain above 1.1821.
Strategy – Remain bullish, move risk to 1.1821 (from 1.1637), targeting above 1.2030 (and much higher)