• Euro could be reaching apex of rising wedge
• Dollar/Yen remains locked in intense downtrend
• Cable attempting to carve major h&s top
• Dollar/Swiss seen bouncing from range lows
• More Inside……
EUR/USD
Charts created using Intellichart - Prepared by Joel Kruger
[B]EUR/USD: [/B]The weekly chart does not look all that bullish and it is quite possible that we are in the final stages of a rising bearish wedge type formation with the price nearing its apex. We would really need to see a break and weekly close below the 1.4150 area to help confirm bias, and until then, we recommend staying on the sidelines until a clearer opportunity presents. Ultimately, only a sustained break above 1.4500 would give reson for concern and threaten longer-term bearish outlook.Agressive bears may want to consider selling rallies into 1.4400
USD/JPY
Charts created using Intellichart - Prepared by Joel Kruger
[B]USD/JPY[/B]: The overall structure for the pair is grossly bearish with the market locked in a downtrend over the past several months. A medium-term lower top looks to be in place by the 2009 highs over 100.00, and we look for deeper setbacks over the coming weeks back towards the critical 87.15 matched trend lows from 2008/2009. Shorter-term studies are however approaching oversold, so we would recommend waiting to sell into rallies back towards 95.00-96.00. The key short-term level to watch below comes in by 91.75.
GBP/USD
Charts created using Intellichart - Prepared by Joel Kruger
GBP/USD: We hold on to our bearish medium-term view in the pair with the market seemingly in the process of carving out a major head & shoulders topping formation. The neckline comes in by 1.6000, and the market right now could be shaping the right shoulder. This however does leave the door open for some upside back towards the 1.6500-1.6700 area, but we do not see gains extending much further, ahead of a pullback below 1.6000 to trigger the pattern and open a measured move back towards the 1.5000 area.
USD/CHF
Charts created using Intellichart - Prepared by Joel Kruger
USD/CHF: Remains confined to a mutli-week chaoppy range trade dating back to May 2009, with the parameters loosely defined between 1.0500 and 1.1000. The market is currently trading by the lower end of the range and we continue to recommend playing the range high-lows until a breakout of some sort occurs. As such, looking to buy dips into the 1.0500’s could be a good strategy, inanticipation of an eventual push back towards 1.1000. The bullish outlook also coincides with our broader bullish USD outlook. Ultimately, only a weekly close below 1.0500 would negate.
AUD/USD
Charts created using Intellichart - Prepared by Joel Kruger
NZD/USD: The market has been trending higher over the past several weeks and for much of 2009. However, it appears as though gains are now starting to stall out with a top forming just ahead of 0.7000. Weekly stochastics are highly overextended and a close below 0.6840 will help confirm topping bias with the market putting in a bearish reversal week. Any rallies from here should be sold into the 0.6900 area, with only a close above 0.7000 giving reason for pause.
USD/CAD
Charts created using Intellichart - Prepared by Joel Kruger
USD/CAD: We hold a very bullish outlook for this pair, with the latest round of setbacks finally stalling out and the market in the process of carving a medium-term base and higher low above the historic lows from late 2007 below parity. Look for a push back above the August 1.1125 highs to confirm and set up a double bottom-like formation that should open fresh upside towards next medium-term resistance in the 1.1700’s. Any dips below 1.1000 should be used as an opportunity to build on existing longs, with only a break back below the 1.0630 yearly lows giving reason for concern.
[B]
EUR/GBP[/B]
Charts created using Intellichart - Prepared by Joel Kruger
[B]EUR/GBP[/B]: The latest rally has stalled out by major falling trend-line resistance off of the late 2008 historic highs and a medium-term lower top is now sought out by 0.8835 ahead of the next downside extension below 0.8400. Look for a break below 0.8650 to confirm and accelerate.
[B]
GBP/JPY[/B]
Charts created using Intellichart - Prepared by Joel Kruger
GBP/JPY: Very difficult to make any clear cut calls here, although given our commentary above on GBP/USD and USD/JPY, we hold a beaish bias. The rally off of the January lows is therefore classed as corrective, and a lower top is now sought out by 163.00 ahead of the next major drop to be confirmed on a break below 148.00. Although we are not crazy about calling this a double top, given that the would be projected downside would nearly fully retrace the 2009-low-highs, there is a double top-like formation that is carving with a neckline by 148.00. As such, we would recommend looking to sell into rallies towards 155.00 in antiicaption of the bearish resumption. Back above 155.00 would delay outlook.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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