USDJPY and EURUSD Technical Analysis

• EURUSD and AUDUSD at critical near term levels
• USDJPY breakout attempt from 6 month coil
• USDCAD former floor of interest near 1.2400

EUR/USD
Weekly




-“Several longer term technical observations are worthy of note; the rate found low at an important long term level. The speculative crowd has never been more bearish…ever. Such conditions typically precede important reversals…although not necessarily right away. A break above the resistance lines (old support) would indicate that behavior has significantly changed and open up a run on 1.13.”
-EURUSD has plummeted since last Friday but is now trading around support from a lower parallel near 1.10. The rate has to hold here in order to maintain a near term constructive outlook. Failure to turn up now opens up 1.0845 (61.8% and 4/17 high) and quite possibly resumption of the broader downtrend.

GBP/USD
Weekly




-“The sharp turn higher (and pending weekly reversal) is promising for longer term bottoming prospects, especially in light of the mentioned divergence and 2 large range weekly reversals in the last 5 weeks. Focus is now on the sliding parallel (lower red line) just shy of 1.55 over the next several weeks.”
-“GBPUSD has met and slightly exceeded 1.55. This is resistance so the next near term move could go a long way in determining the next larger move. A break higher would open up the Dec high (near the next slope level) at 1.5785.”
-Keep the 50% decline from the 2014 high / Oct low at 1.5874/78 in mind for a top if reached. Weakness below 1.5390 would open up 1.5190 and 1.5090.

AUD/USD
Weekly




-“Trade outside of the bearish upper parallel that has contained strength since late October would shift focus to a former support line (turned resistance in January) near .8180.”
-“A broadening bottom pattern yields an objective of .8342 (just above the Jan high at .8294) but AUDUSD has met the line that extends off of the Aug 2013 and Jan 2014 lows (former support).”
-AUDUSD is at critical support and a break risks formation of a broader range.

NZD/USD
Weekly




-“One can’t help but notice that an epic double top is possible with a target of .5898. That would trigger on a drop below .7370.”
-“The big NZDUSD double top has failed so far but slope resistance comes into play more or less at the current level and near .7800.”
-A bearish wedge pattern has formed and yields an objective of .6607.

USD/JPY
Weekly




-A USDJPY breakout from the 6 month coil would open up 123.16-124.13 (high close from June 2007 and 2007 high). A measured objective from the pattern yields 128.12.
-Failure to maintain 119.60 would negate bullish considerations.

USD/CAD
Weekly




-“The breakdown from a 2 and a half month topping pattern could ‘kick-off’ a much larger decline but near term focus is on early congestion from 1.1931 to 1.2046.”
-USDCAD has turned up from just below 1.1931 (low was 1.1919). The break above the median line opens up a run on former support from 1.2350 to 1.2447.

USD/CHF
Weekly



-“USDCHF has reversed from 9 year trendline resistance. Focus is on the median line (about .9300) that extends off of the 2012 high. This line crosses through highs in 2013 and the October 2014 low. The 52 week MA is near this line as well.”
-USDCHF is trading ‘around’ the long watched median line. A short term double bottom has completed and yields a target of .9637 but beware of resistance from the combination of trendlines and former lows near .9550 next week.


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Here I am) again with my USD/JPY strategy.

I guess there was a pivot at 121.75 and the pair will go further down these days, but I don't really think it can break a supportive level of 119.10. Thats why I'm going to open a sell at 121.45 with target at 119.40 and SL 121.80.

The USD/JPY continues to give bears great opportunities, while my expectations were completely broken with all the resistant levels.

"The Japanese yen was initially under pressure, but supported by the US weak statistics, the yen started to strengthen against the US dollar. Nevertheless, the dollar recorded "profit" at the end of the day. The pair is influenced by the main event for the yen - the Bank of Japan monetary policy meeting decisions announcement. The Japanese regulator has left the policy unchanged which disappointed some investors that expected further economic stimulus. The US regulator also left interest rates unchanged.

The pair dollar/yen remains under pressure, but all attempts to break through the support near 117.95-118.15 are unsuccessful. The dollar is bought off on dips, and it could develop the upward dynamics above 119.25-119.45.

The support levels: 119.05-119.25, and the resistance levels: 120.20-120.40.

The MACD indicator is in a neutral territory.

Trading recommendations

The bears’ inability to break through and consolidate below 117.95-118.15 may lead to a profit-taking with the following growth towards the 120th figure."

That's what FF recommends to do. What do you think about it?

There is some strong resistance level at 124.18. So, I expect a pullback to 124.18 abd decline to 123.53

• EURUSD bottoming process?
• USDJPY at 13 year high
• NZDUSD at make or break parallel

EUR/USD
Weekly

-“Several longer term technical observations are worthy of note; the rate found low at an important long term level (line off of 2008 and 2010 lows) and the ownership profile (as per COT) is at a record. The speculative crowd has never been more bearish…ever. Such conditions typically precede important reversals…although not necessarily right away. A break above the resistance lines (old support) would indicate that behavior has significantly changed and open up a run on 1.13.”
-EURUSD has responded well to a long term slope confluence. Focus is higher towards at least 1.18 as long as price is above the May low.

GBP/USD
Weekly

-“Keep the 50% decline from the 2014 high / Oct low at 1.5874/78 in mind for a top if reached. Weakness below 1.5390 would open up 1.5190 and 1.5090.”
-GBPUSD ended up finding top at 1.5814 in May. The decline found support near the mentioned 1.5190. The failure at slope resistance raises the specter of continued long term weakness. If a larger decline is underway then expect to see resistance from 1.5490 to 1.5570.

AUD/USD
Weekly

-“A broadening bottom pattern yields an objective of .8342 (just above the Jan high at .8294) but AUDUSD has met the line that extends off of the Aug 2013 and Jan 2014 lows (former support).”
-The mentioned line pinpointed the high and AUDUSD is approaching trend lows. The next support area is probably the trendline that extends off of the 2001 and 2008 lows (7 year cycle lows?) near .7100 through most of June. Exceeding .7818 would suggest that additional sideways is in order and delay the next bear leg.

NZD/USD
Weekly

-“One can’t help but notice that an epic double top is possible with a target of .5898. That would trigger on a drop below .7370.”
-“A bearish wedge pattern has formed and yields an objective of .6607.” Above .7200 would AT LEAST delay bear trend resumption and potentially indicate that a major low has formed at long term pitchfork support.

USD/JPY
Weekly

-“A USDJPY breakout from the 6 month coil would open up 123.16-124.13 (high close from June 2007 and 2007 high). A measured objective from the pattern yields 128.12.”
-Focus remains on 128.12 as USDJPY is trading at 13 year highs (exactly). Another level to be aware of is the 1997 high at 127.50. Weakness below 123.60 is needed in order to indicate a behavior change.

USD/CAD
Weekly

-“USDCAD has turned up from just below 1.1931 (low was 1.1919). The break above the median line opens up a run on former support from 1.2350 to 1.2447.”
-USDCAD traded into the reversal week close (from March) at 1.2558 before coming off. A broader range may in store. In fact, weekly RSI recorded its 2nd highest reading ever in Jan (only higher reading was in 1984). Other high periods led to extended periods of sideways trading. The failed run at a high volume level (1.2560) twice this week warns of additional range trading.


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The USD/JPY is likely to go further down in the near future, so I guess I should open a sell there.

Talking Point

• Euro briefly probes above key Fibo
• GBP/USD nearing important moving average
• USD/JPY cracks key support

EUR/USD

• EUR/USD probed above the 78.6% retracement of the May range near 1.1330 this morning before falling off
• Our near-term trend bias is higher is higher in the euro while above 1.1035
• A close above 1.1330 is needed to set off a more important leg higher in the rate
• A turn window of some importance is seen here
• A close below 1.1035 would turn us negative on the exchange rate

EUR/USD Strategy: Like the long side while above 1.1035

Instrument	Support 2	Support 1	Spot	Resistance 1	Resistance 2
EUR/USD	1.1035	1.1155	1.1305	1.1330	1.1390

GBP/USD

• GBP/USDhas traded steadily higher since finding support last week near the 50% retracement of the April – May range near 1.5190
• Our near-term trend bias is higher in the pound while above 1.5190
• The 61.8% retracement of the mid-May to June decline at 1.5565 needs to be overcome to set off a more serious advance
• A minor turn window is seen around the end of the week
• A daily close under 1.5190 would turn us negative on the GBP/USD

GBP/USD Strategy: Square

Instrument	Support 2	Support 1	Spot	Resistance 1	Resistance 2
GBP/USD	1.5190	1.5310	1.5450	1.5500	1.5565

USD/JPY

The market has been excited about USD/JPY and the potential for a sharp move higher after it broke out from a near 6-month consolidation late last month (us included). In hindsight it was clearly too excited. Sentiment towards the yen recently fell to just 5% bulls on the Daily Sentiment Index (DSI) which historically has been a pretty reliable gauge of too many participants liking the same trade. The sharp move lower today in response to Kuroda’s JPY REER valuation comments is a perfect example of what can happen when everybody gets caught leaning the same way. With the tree now good and shaken the big question is was that it or does this correction have more room to run? The bullish take of this action would be that it is some sort of backtest of the 6-month pattern breakout. If this is the case, spot could still trade down towards the December and March closing highs around 121.40 and remain structurally sound. We wouldn’t want to see the exchange rate fall too much below there, however, as that would raise some serious questions about the integrity of the May breakout.


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Well, I guess, there will be some growth to 123.50 and a pullback to 122.60

There is a strong local pressure of bulls. Resistance in 124.26. Support for a possible pullback and purchases - 123.42 (the middle Bollinger band ).