• Euro In Buy Zone
• Japanese Yen Slips Under 106.00
• British Pound Rally Should Accelerate
• Swiss Franc Expanded Flat
• Canadian Dollar Breaks 1.0248
• Australian Dollar .8682 Line in the Sand
• New Zealand Dollar Unclear
[B]SEE A DESCRIPTION AT THE BOTTOM OF THIS REPORT FOR THE INDICATORS IN THE TABLE[/B]
[B]Join other traders in discussing Elliott Wave Theory on the DailyFX Forum.[/B]
[B]
[/B]
[B]
[/B]
Commentary: We wrote yesterday that “the EURUSD is likely to drift lower near term into a support zone from 1.4762 to 1.4818. Still, the EURUSD is very bullish as long as price is above 1.4639. As we have mentioned recently, objectives are in the 1.5200/1.5300 area.” The pair has come right into this zone and has bounced. Again, the bias is bullish as long as price is above 1.4639 and our target is above 1.5200.
Strategy: Bullish, against 1.4639, target TBD
Visit our recently updated Euro Currency Room for specific resources geared towards this currency.
Commentary: The break below 107.20 warrants a breakout strategy. We did mention that we “favored a rally to exceed 110.11 as an expanded flat (shown as a-b-c) before the next bearish leg.” That obviously did not happen as the pair broken below 106.00 this morning. If you wish to take advantage of this bear leg that we expect to drop below 100 (objectives are near 97.50), then resistance should be strong at 107.22 and the bias is bearish as long as price is below 108.33.
Strategy: Get bearish near 107.20, against 108.40, target below 100
Visit our recently updated Yen Currency Room for specific resources geared towards this currency.
Commentary: We wrote yesterday that “given the shelf of support just below 1.9500, the rally this morning makes it possible that at least a multi-week bottom is in place at 1.9483. As such, a bullish bias is warranted against 1.9524 for a rally to at least the 2.0100 level (former resistance). We do not know yet of course whether or not the decline from 2.1160 will complete 5 waves – so far the decline is in just 3 waves. Recent COT data argues for a significant GBP low to form.” We stand by this analysis and expect the Pound to continue gaining.
Strategy: Bullish, against 1.9524, target TBD
Visit our recently updated British Pound Currency Room for specific resources geared towards this currency.
Commentary: Near term, we still expect a rally but the corrective advance unfolding from 1.0884 is probably an expanded flat. The flat would be complete following a rally through 1.0948. Resistance is in the 1.0978/1.1046 zone and the bias is bearish as long as price is below 1.1190. We do not have any clear targets at this point. Given the unfavorable reward/risk ratio at the current juncture, we advocate pursuing opportunities elsewhere.
Strategy: Flat
Commentary: We have mentioned the last few days that our confidence in the USDCAD bearish structure was low. This morning’s push through 1.0248 negates the bearish outlook. Our previously alternate count is now the favored one; and the bullish potential is great. The next level of resistance is the 200 day SMA at 1.0364, but the next level of chart resistance is not until 1.0866. A measured objective is at 1.0915 (extension). We are waiting for the short term pattern to offer a lower risk bullish entry.
Strategy: Bearish, against 1.0248 BUT look to exit near 1.0050 if given the chance
Visit our recently updated Canadian Dollar Currency Room for specific resources geared towards this currency.
Commentary: We maintain a bullish bias above .8682 but the decline from just above .9000 has us a bit worried. “The AUDUSD is in the same position as the EURUSD. Wave 3 within the 5 wave bull cycle from .8584 is underway. Ultimately, we expect this rally to lead to the completion of the entire rally from 2001. Objectives are in the .9600-1.0000 zone.” We will reconsider if proved wrong; which requires a drop below .8682.
Strategy: Bullish, against .8682, target TBD
Commentary: Strategy has remained flat recently and that is because we have honestly had no idea what is going on with NZDUSD. Yesterday’s violent drop is from the top. Typically, violent declines occur in the middle of moves, not at the beginning. This is why we find this quick decline suspect. That, and that other counts are dollar bearish. The count on the above chart is one that we had showed in previous months and at this point is favored…but confidence is too low for us to commit at this point.
Strategy: Flat
Tell us what you think about this report: contact the strategist about the article at <[email protected]>