- EURUSD bullish above 1.4000
- GBPUSD wave ii of diagonal may be done
- USDCAD 5 waves complete; headed back to 1.11-1.12
- USDCHF bearish below 1.0900
Euro / US Dollar
I wrote yesterday that trading above 1.4140 shifts odds in favor of the bullish count in which the decline from 1.4340 is an A-B-C correction that will be fully retraced. Under this count, the rally from 1.3750 is wave 5 of an ending diagonal from 1.2454. The rally from 1.3750 itself is unfolding as a diagonal and price must stay above 1.3887 in order to keep this count valid. The bearish count is not completely eliminated as no rules have been broken (see the alternate numbering) but its prospects are damaged given the time taken up by what would be wave ii. From a trading perspective, ST may want to short here, targeting support at 1.3900. The EURUSD dropped to 1.4000 and has surpassed yesterday's high. IF price drops below 1.4000, then structure would be decidedly bearish. 1.3400-1.3600 would be the target area.
British Pound / US Dollar
I wrote yesterday that the rally from 1.6231 is in 3 waves but could be wave i of an ending diagonal in the wave v position. Staying above there keeps the trend pointed up and there potential support at 1.6430. Cable dropped to 1.6380 this morning in what could be wave ii of the diagonal. The key level remains 1.6231. A potential target is the psychological 1.7000.
Australian Dollar / US Dollar
The AUDUSD decline from .8269 is corrective in nature therefore odds favor a rally through that level prior to a top and reversal. The rally through .8124 favors bulls and the trend is bullish as long as price is above .7925.
New Zealand Dollar / US Dollar
My focus remains on the longer term structure, especially the rally from .4890, which is a textbook zigzag. Waves A and C are equal (and price reversed at the 50% retracement of the decline from .8219), which is common. However, the uneasy sentiment remains here since the recent decline is more corrective than impulsive.
US Dollar / Japanese Yen
The triangle continues to play out but there is an alternate bearish count in which the drop from 101.50 is a series of 1st and 2nd waves. 93.50 defines the trend (above is bullish and below is bearish). Watch for potential resistance at 97.20 (6/19 high).
US Dollar / Canadian Dollar
I wrote yesterday about the USDCAD that the implications are bullish over the next several months (and beyond) but bearish over the next several weeks. Under this count, a 5th wave would complete the rally from 1.0782 and give way to a multi week and potentially deep correction of the rally from 1.0782. After reaching 1.1660, the USDCAD reversed and the aforementioned correction is underway. Fibonacci support is the 1.1100-1.1200 zone.
US Dollar / Swiss Franc
As mentioned in recent days, the rally from 1.0589 is a 3 wave correction that should be fully retraced. Confirming that the larger trend is still down is the 5 wave decline from 1.1026. A correction ended at 1.0893 and the objective is below 1.0367.
Jamie Saettele publishes Daily Technicals every weekday morning (930 am EST), COT analysis (published Monday mornings), technical analysis of currency crosses throughout the week (EUR on Tuesday, JPY on Wednesday, GBP on Thursday, AUD on Friday), and the DFX Trend Index every day after the NY close. He is also the author of Sentiment in the Forex Market.
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