Commentary - We have been looking for a test of 160.00 before thinking about turning bearish for the next leg lower. However, the rally from 155.14 does not look complete. After pushing through the 61.8% of 168.94-149.25 at 161.42, the next level fo potential resistance is the 78.6% at 164.73. This is close to where the rally from 154.53 would equal the 149.25-159.67 rally.
Strategy - Look for a top and reversal near 164/165
Commentary - The EURCHF is in a similar position as the EURJPY. That is, the decline from July high is corrective but so is the advance from the August low. This price action suggests that a more complex correction is underway. Potential resistance is at the 78.6% of 1.6686-1.6175 at 1.6577 as well as the 100% extension of 1.6175-1.6498/1.6333 at 1.6655.
Strategy - Look for a top and reversal near 1.6577/1.6655
Commentary - For the past few months, we have stated that “there is little doubt that the pair is headed much higher in coming months (as the rally is clearly impulsive and the decline corrective).” The EURGBP finally broke higher in wave 3 and the pair is most likely headed for a test of the 2003 high at .7254 in the next few months. A bullish objective is at the 161.8% ext. of .6535-.6867/.6679 at .7216. The longer term bullish structure is strong as long as price is above .6826 (although the pair is unlikely to come close to there).
Strategy - Remain bullish, against .6826, target .7200
Written by Jamie Saettele, Technical Currency Strategist for DailyFX.com