The EURUSD appears to be building a base from 1.4000 that will propel the pair to fresh 2009 highs next week.
Euro / US Dollar
A 4th wave triangle is complete and expectations are for an upside break through 1.4340 and then 1.4720. A small second wave is likely complete at 1.4000. A bullish caution bullish bias is warranted against 1.3877 (dropping below 1.4000 would not alter the bullish structure).
British Pound / US Dollar
A triangle is also complete in the GBPUSD. On short term charts, the rally from 1.6337 can be counted as a 5 wave rally. This suggests that the larger trend is up. This is potential short term support at 1.6430.
Australian Dollar / US Dollar
The AUDUSD has broken above its June high, confirming that wave C (as well as the entire rally from the October low) is near completion. .8385 (61.8% of the decline from .9856) is a level to watch as potential resistance. Near term, there is the possibility of a drop below .8120 - in which case .7945-.8020 would be potential support (50%-61.8% of .7698-.8344).
New Zealand Dollar / US Dollar
The NZDUSD is in the same position as the AUDUSD. The break to a 2009 high indicates that wave v of C is underway. Although anticipating a reversal, there is no evidence of one yet. Potential resistance is at .6958. A drop below .6467 exposes Fibonacci and structural support in the .6380-.6420 zone.
US Dollar / Japanese Yen
The drop below 93.50 eliminates the bullish triangle count and leaves us with the bearish count in which the decline from 101.50 is a series of 1st and 2nd waves. The USDJPY has traded through the day SMA (95.22 today), and focus is now on channel resistance, which is at 96.71 today and decreases about 5 pips per day. Bears remain favored against 97.00.
US Dollar / Canadian Dollar
The entire rally from 1.0782 has now been retraced. Additional weakness is expected over the next several weeks in order to complete the decline from 1.1730 and by extension the entire decline from 1.3068. 1.0588 is the next level of potential support (Fibonacci). Near term, the USDCAD may stage a rally back to 1.1115 as short term momentum indicators are divergent with the latest lows. Structurally, the rally would be considered a B wave within the second A-B-C pattern since the top at 1.3068.
US Dollar / Swiss Franc
Sticking with the USD bearish count, expectations over the next several weeks are for a thrust lower that ends below 1.0367. Bears are favored against 1.1026 and 1.0037 is a potential target (100% extension of 1.2303-1.0367).
British Pound / Japanese Yen
The GBPJPY has broken above a line drawn off of the June 12, June 30, and July 23 highs. Bulls are favored against 153.84 and short term support extends to 155.66.
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. Follow his intraday market commentary at DailyFX Forex Stream.
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