Euro Commodity Crosses Headed Higher


Commentary - Last week we wrote about the long term picture and showed the 18 year triangle on the monthly chart. Price bounced off of triangle support a few months ago and our contention is that the pair is headed much higher in the coming months. The short term charts favor a run-up as well. The declines at varying degrees of trend are in 3 waves, which indicates corrective movements and that the dominant trend is towards higher prices. A push through 1.6843 sets sights on 1.7450. 1.6400 is near term risk and should remain intact.
Strategy - Near term, bullish against 1.6400, target 1.7450

Commentary - We maintain a bullish bias and risk can be moved to 1.4264 from 1.4124. The entire rally from the June low of 1.4124 is a correction of the March-June decline. Corrections unfold in 3 waves (a-b-c) and the end of the correction (c wave) is usually the strongest move. It is likely that wave c began at 1.4195. Wave c (from 1.4195) would equal wave a (1.4124-1.4643) at 1.4714. The 38.2% of the March-June decline (1.5683-1.4122) is at 1.4718. This is the initial bullish objective.
Strategy - Remain bullish, move risk to 1.4264 (from 1.4124), target 1.4700.

Commentary - See last week?s analysis for the longer term outlook. Near term, look for structural/potential trendline support near 1.9675/1.9725 before a push through 2.0060. A 5 wave rally (possibly wave 3 in a 5 wave advance from 1.8815) appears complete at 2.0060, and the former 4th wave (mentioned 1.9675) should provide initial support.
Strategy - Flat

Written by Jamie Saettele, Technical Currency Analyst of