The US dollar is consolidating last week's gains. The most interesting pattern is seen in the AUDUSD, which shows a 5 wave decline from it's 2009 high.

Euro / US Dollar

As long as the EURUSD is below 1.4680, my working assumption is that an important top is in place above 1.4800 (either a B wave or 2nd wave high within the bear that began at 1.6000 in 2008). Coming under 1.4480 would likely lead to an acceleration of weakness towards a 100% extension at 1.4360 and a 161.8% extension at 1.4160. Above 1.4680 would negate the short term bearish view.

British Pound / US Dollar

Former support has held as resistance (1.6111) and a near term target is 1.5290 (161.8% extension of 1.7050-1.6111). There is a potential resistance line at 1.6171 tomorrow.

Australian Dollar / US Dollar

Following the break to a new 2009 high, the AUDUSD has declined in a clear 5 waves. Bears are favored against the high (.8866). If that level fails to hold, then focus would shift to .8950 and .9030. .8950 is a former support level and .9030 is the 78.6% retracement of the decline from the 2008 high.

New Zealand Dollar / US Dollar

NZDUSD price action since its 2009 high has been choppy. The topline of a channel since July and the midline of a channel since March rejected the NZDUSD advance but the NZDUSD has yet to come off much. A bearish outcome is possible as long as price is below .7260.

US Dollar / Japanese Yen

Former support held as resistance earlier this week, which kept us bearish. Additional comments last week were while the trend is bearish below 91.65, the strength of the rally from channel support warrants consideration that a more important low is in place. Trading above the short term resistance line extended from the 9/21 and 9/24 highs would be a sign that something more constructive is taking place. For this reason, move risk on shorts to 90.50. We'll remain bearish below there, targeting a drop below 87.10. A potential resistance line is at 90.63 tomorrow and decreases 18 pips per day.

US Dollar / Canadian Dollar

Maintain a bullish bias above 1.0650. The rally from 1.0588 could be a series of 1st and 2nd waves. This count is extremely bullish and gives scope to an extended rally. With the USDCAD back above the former channel, confidence in the upside is increased. Clearing 1.1130 would expose 1.1417 (former support).

US Dollar / Swiss Franc

The USDCHF daily wave count warns (and has been warning) of a significant low. The USDCHF has broken through the top of a short term channel and is just below the top of a longer term channel line. Favor the upside.

Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Monday mornings), technical analysis of currency crosses on Monday, Wednesday, and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates. He is the author of Sentiment in the Forex Market. Follow his intraday market commentary at DailyFX Forex Stream.

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