• Euro Rejected at Triangle Resistance
• Japanese Yen Testing Highs (USDJPY Lows)
• British Pound 5 Waves Up Gives Way to Decline
• Swiss Franc Breaks Out
• Canadian Dollar Oscillating Near Parity
• Australian Dollar Spike High Through .9100
• New Zealand Dollar .7900 Continues To Provide Resistance
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Commentary: The EURUSD did hit triangle resistance at 1.4900 (if a triangle is unfolding). The next leg of the triangle will be lower in wave e in order to complete larger wave 4 before the thrust higher in wave 5 through 1.50. Look to get bullish near 1.4575/1.4600 (the 61.8% of 1.4362-1.4910 is at 1.4571), against 1.4310, for a run at the mid 1.50’s. The time sequence of the triangle favors the idea that wave d is complete. The first leg of the triangle took 20 days, the next leg 17 days, this leg would be 6 days today…so a top today or tomorrow seems reasonable. This time sequence would lead to a low that we look to buy in wave e sometime late next week.
Strategy: Flat
Visit our recently updated Euro Currency Room for specific resources geared towards this currency.
Commentary: We still maintain that the strong rally from 104.97 is probably a c wave that will complete a larger second wave as an expanded flat. If this count is correct, then price is expected to exceed 107.92 and resistance should be strong in the 108.33 area. We will look to return to a bearish bias following a rally through 107.92 (against 110.11) for a drop to our objectives that are below 100 (near 97). Near term, the pattern is not all that clear but this is what one would expect in a corrective sequence. The path could be lower prices and a test of the mid 105s before a thrust higher to complete the correction. Another reason to favor one more advance before the next big down leg is that the short term pattern resembles an inverse head and shoulders.
Strategy: Flat
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Commentary: Yesterday we wrote that “a top for wave A might be in place at 1.9949. Wave 5 of A appears to take the form of a diagonal (overlapping waves) and diagonals are usually fully retraced. In this case, the origin of the diagonal is close to the 38.2% of 1.9337-1.9949 at 1.9715. The next move is towards this level – we will look to buy this dip.” Look for the decline to accelerate in the next few days.
Strategy: Bearish, against 1.9960, target 1.9600
Visit our recently updated British Pound Currency Room for specific resources geared towards this currency.
Commentary: We have continued to state that “the bias is bearish as long as price is below 1.1122…Bigger picture, the decline from 1.1122 is probably a 5th wave (of larger 3) and an objective is where wave 5 equals 61.8% of waves 1 through 3 – at 1.0553.” The USDCHF has broken lower and 1.0550 is in sight.
Strategy: Flat (unfortunately we got out yesterday….too soon apparently)
Commentary: The scenario that we have described recently is playing out. Expectations are for a corrective rally that we will look to sell into. Look for the rally from .9872 to face strong resistance in the 1.0125/84 zone. This is the 50%-61.8% of 1.0378-.9872. Former resistance is also at 1.0117.
Strategy: Flat
Visit our recently updated Canadian Dollar Currency Room for specific resources geared towards this currency.
Commentary: 5 waves up from .8512 is complete at .9014 so expectations are for a decline to unfold over the next week or so that brings price back to the .8763/.8704 zone (this is the 50%-61.8% of .8512-.9014). The pattern is the exact same as the USDCAD (but in the opposite direction).
Strategy: Flat
Commentary: The NZDUSD is in the exact same position as the AUDUSD and GBPUSD and USDCAD (but inverse). Given that the GBPUSD, USDCAD, and AUDUSD all show clear 5 wave moves towards dollar weakness – and that a countertrend 3 wave dollar rally is expected across the board, it is reasonable to expect a NZDUSD drop to at least .7648 (50% of .7383-.7913) or .7588 (61.8%) before the next advance.
Strategy: Bearish, against .7933, EXIT .7650
MONTHLY, WEEKLY and DAILY TRENDS are determined by rolling pivots (4 month, 4 week, and 5 day). When price is above the rolling pivot, the trend is considered bullish. When price is below the rolling pivot, the trend is considered bearish.
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