Euro Breaks Below Short Term Channel Support; Eyes 1.4400

Thu, 01 Oct 2009 11:53:34 -0400

By Jamie Saettele, Senior Currency Strategist

The EURUSD has broken below a short term channel.  The trend is down as long as price is below 1.4680 and a short term target is 1.4410 (former resistance). 


Euro / US Dollar


I wrote yesterday that “coming under the channel would set sights back on 1.4450.”  The channel broke and a short term objective is 1.4410.  The trend is bearish below 1.4680.              

British Pound / US Dollar


Former support held as resistance (1.6111) and a short term channel defines the trend for now.  A near term target is 1.5290 (161.8% extension of 1.7050-1.6111).  The trend is down below 1.6130. 

Australian Dollar / US Dollar


The AUDUSD broke to a new high and levels to keep in mind that could produce reversals are .8950 and .9030.  .8950 is a former support level and .9030 is the 78.6% retracement of the decline from the 2008 high.  Watch the short term support line (in red).  Coming under there would be an early indication of a trend change. 

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.  Coming under .7100 would probably induce selling pressure and send the pair to .6900.  Until then, the waters are murky.

US Dollar / Japanese Yen


Former support has held as resistance in the USDJPY thus far.  “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.

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 from current price.

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 approaching 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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