[B]• Euro 1.4500 Proving Itself as Resistance
• Japanese Yen Move to Accelerate
• British Pound Top Near 2.0900?
• Swiss Franc Bullish (USDCHF Bearish) Below 1.1640
• Canadian Dollar Consecutive Weeks Move Suggests Potential for Turn
• Australian Dollar: Sell .9106 Break
• New Zealand Dollar Bearish Against .7738[/B]
Commentary: 1.4500 is an important psychological level and it is possible that 5 waves higher from 1.4135 and 1.3360 are complete. At the very least, a return to short term support at 1.4404 is expected. RSI on the weekly and daily charts is overbought and divergent, indicating potential for a top and reversal.
Strategy: Flat
Commentary: We wrote last week to “expect a spike through 115.14 and possibly a test of the 61.8% of 115.91-114.46 at 115.36 before the next leg lower begins.” The spike ended at 115.41 in what we are treating as wave ii within a new 5 wave bear cycle from 115.91. Wave iii lower is underway and the bearish bias is strong as long as price is below 114.81. Look for the decline to accelerate.
Strategy: Remain bearish, move risk to 115.41 (from 117.10), target below 111.59
Commentary: We have been focusing on the bullish trend channel whose resistance line is near 2.10/2.11. Cable tested 2.0900 (2.0895) Friday. While a test of 2.1000/2.1100 remains possible, it does appear that the decline from 2.0895 is in 5 waves, therefore we expect at least one more similar decline. Short term resistance is at 2.0829.
Strategy: Get bearish near 2.0829, against 2.0895, target TBD
Commentary: There is no change to our call for lower prices. Ultimately, price could extend as low as the 161.8% extension of 1.1894-1.1599/1.1785 at 1.1308.” Wave iii of 5 is underway now and the larger bearish bias is strong as long as price is below 1.1785. Short term, price below 1.1640 keeps the bearish bias intact. Until we see a 5 wave rally to signal a turn, we wll remain bearish.
Strategy: Bearish, against 1.1640, target 1.1350
Commentary: We maintain that the USDCAD is getting very close to a bottom. Historically, 8 weeks in a row in one direction tends to lead to at least a sizeable move in the other direction. The red dots on the chart above signal 8 consecutive down weeks, which has occurred the last two weeks. This combined with parallel channel support and weekly RSI at 12 suggests that a low will form soon.
Strategy: Flat
Commentary: The Aussie is turning lower. It appears that the first leg of an extended down move is over at .9106 and that the rally from .9106 is a correction of the decline. Resistance at the 61.8% of .9342-.9106 at .9252 has held so far. Coming under .9106 instills confidence in the bearish bias.
Strategy: Sell break of .9106, against wave ii high (that would be .9248 at this point), target TBD (it will be a measured objective…probably near .8750)
Commentary: The NZDUSD is in a similar situation to that of the AUDUSD. A first leg lower in a bigger bearish move is complete at .7568 and the rally from there is a correction of the decline. The rally has stalled at the 61.8% of .7737-.7568 but the bearish bias is intact as long as price is below .7737. Expect the next bear leg to test at least .7365.
Strategy: Bearish now, against .7738, target TBD
