Technical Analysis

EUR/USD Current price: 1.2970



Better than expected US Retail sales data, is giving a lift to greenback across the board: the EUR/USD falls to fresh daily lows after failing to regain 1.3000 over European hours, although held above 1.2935, past week low and immediate support. The hourly chart shows 20 SMA turning flat around 1.2970, which stands also for the 23.6% retracement of the daily fall from 1.3710 to 1.2744, and price holding around the level *after the initial kneejerk, while indicators hover around their midlines, lacking strength either side of the board at the time being. In the 4 hours chart, momentum and RSI turned flat in oversold territory, while 20 SMA gains bearish slope above current price. The downside continues to be favored with a break below 1.2935 required to confirm and extension towards 1.2880 next strong support.

Support levels: 1.2935 1.2880 1.2840
Resistance levels: 1.2970 1.3000 1.3030*

GBP/USD Current price: 1.5356



Hardly changed from early week opening, the GBP/USD trades in a tight 60 pips range, finding sellers around 1.5390, 200 EMA in the 4 hours chart. In the hourly chart, technical indicators had already corrected extreme oversold readings reached past Friday, and turn back lower right above their midlines, while price hovers around a flat 20 SMA. In bigger time frames, technical outlook remains bearish, although price found buyers around 1.5310, 38.2% retracement of the 1.4830/1.5605 rally. A break below this last should anticipate further slides, with 1.5240/60 area as next bearish target.

Support levels: 1.5310 1.5285 1.5240
Resistance levels: 1.5390 1.5420 1.5465*

USD/JPY Current price: 101.78



The USD/JPY rose up to 102.14 today, although maintains a quiet consolidative range ahead of US opening, finding intraday support around 101.50. The hourly chart shows some bearish divergences coming from indicators that eased all the way back to their midlines, while price maintains the highs. Still seems quite dangerous to attempt selling the pair, as market players are eager to buy on dips. In bigger time frames, the outlook indicators hold in overbought territory, far from suggesting a downward correction.

Support levels: 101.50 101.10 100.60
Resistance levels: 102.15 102.50 102.90
AUD/USD: Current price: 0.9980



The AUD/USD holds the negative bias, having been as low as 0.9952, still unable to pop the 0.9950 rumored barrier. The hourly chart shows 20 SMA capping the upside since early Europe, while indicators aim higher below their midlines. In the 4 hours chart momentum accelerates lower in negative territory, reflecting the still strong selling interest. Once the support gives up, the slide your extend today, eyeing 0.96 in the midterm.

Support levels: 0.9960 0.9915 0.9870
Resistance levels: 1.0000 1.0030 1.0080*

EUR/USD - Euro / US Dollar
Entry: 1.3
Stop: 1.3035
Resistances: 1.3135 - 1.305 - 1.3025
Supports: 1.2935 - 1.2965 - 1.2995



AUD/USD - Australian dollar / US Dollar
Entry: 0.998
Stop: 1.0015
Resistances: 1.0095 - 1.003 - 1.0005
Supports: 0.99 - 0.994 - 0.9965



EUR/AUD - Euro / Australian dollar
Entry: 1.3025
Stop: 1.299
Resistances: 1.3105 - 1.307 - 1.305
Supports: 1.294 - 1.297 - 1.2995



GBP/USD - British Pound / US Dollar
Entry: 1.5315
Stop: 1.534
Resistances: 1.538 - 1.5365 - 1.533
Supports: 1.526 - 1.528 - 1.531



EUR/GBP - Euro / British Pound
Resistances: 0.855 - 0.853 - 0.8505
Supports: 0.843 - 0.846 - 0.8475



USD/CHF - US Dollar / Swiss Franc
Resistances: 0.963 - - 0.955
Supports: 0.942 - 0.948 - 0.952



USD/CAD - US Dollar / Canadian Dollar
Resistances: 1.0155 - 1.013 - 1.011
Supports: 1.004 - 1.0065 - 1.009



EUR/CHF - Euro / Swiss Franc
Resistances: 1.246 - 1.244 - 1.2415
Supports: 1.2335 - 1.236 - 1.2395



EUR/CAD - Euro / Canadian Dollar
Resistances: 1.321 - 1.3185 - 1.3155
Supports: 1.307 - 1.3105 - 1.3125



USD/JPY - US Dollar / Yen
Resistances: 102.4 - 102.05 - 101.7
Supports: 100.55 - 100.9 - 101.25



EUR/JPY - Euro / Yen
Resistances: 132.85 - 132.3 - 132
Supports: 130.3 - 130.6 - 131.65



GBP/JPY - British Pound / Yen
Resistances: 156.8 - 156 - 155.75
Supports: 153.85 - 154.75 - 155.15




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This week the pound unfolded towards the downside as expected and we are now able to calculate short term targets and invalidation points, we are updating the main count according to the latest price action.

8-Hours Main Count
- Invalidation Point: 1.5447
- Confirmation Point: 1.5314
- Downwards Target : 1.5271
- Wave number: Wave (3) black
- Wave structure: Motive
- Wave pattern: Impulse

Elliott Wave chart analysis for the GBPUSD for 10th May, 2013. Please click on the charts below to enlarge.
Main Wave Count



This count expects that wave 4 maroon is complete as a triangle labeled (A) through (E) black.
It is expected that wave 5 maroon is unfolding towards the downside and within wave 5 maroon wave (1) black is complete as an impulse labeled waves 1 through 5 blue and this count expects that wave (2) black is highly likely complete as well and that wave (3) black is underway.
Wave (2) black is likely complete as a triple zigzag labeled waves W, X, Y, X and Z blue.
Wave W blue unfolded as a zigzag labeled waves a, b and c pink.
Wave X blue unfolded as a three wave structure labeled waves a, b and c pink.
Wave Y blue unfolded as a zigzag labeled waves a, b and c pink.
The second wave X blue unfolded as a three wave structure labeled waves a, b and c pink and this count expects that wave Z blue is underway.
Wave Z blue unfolded as a zigzag labeled waves a, b and c pink and this count expects wave (3) black is unfolding towards the downside.
Within wave (3) black waves i and ii pink are complete and wave iii pink is extending towards the downside.
Within wave iii pink waves (i) through (iii) green are likely complete and wave (iv) green is underway.
Wave (i) green unfolded as an impulse labeled waves i through v orange.
Wave (iii) green unfolded as an impulse labeled waves i through v orange.
This count would be confirmed by movement below 1.5314.
At 1.5271 wave iii pink will reach 2.618 the length of wave i pink.
This count would be invalidated by movement above 1.5447 as wave (iv) green may not enter the price territory of wave (i) green.



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Majors

EUR/USD: SELL AT 1.3033 FOR 1.2878 OBJECTIVE, STOP 1.3085
USD/JPY: LONG AT 101.60 FOR 103.06 OBJECTIVE, STOP 100.45
GBP/USD: SHORT AT 1.5330 FOR A 1.5196 OBJECTIVE; STOP AT 1.5390
USD/CHF: BUY AT .9510 FOR .9660 OBJECTIVE, STOP .9434
AUD/USD: SELL AT 1.0015 FOR .9850; STOP AT 1.0100
USD/CAD: LONG AT 1.0100 FOR 1.0236 OBJ, STOP 1.0040
Crosses

EUR/JPY: LONG AT 128.50 FOR 133.65; STOP 130.79
EUR/GBP: BUY AT .8385 FOR A .8592 OBJECTIVE; STOP AT .8320

EUR/CHF: BUY AT 1.2370 FOR A 1.2515 OBJECTIVE; STOP AT 1.2340
EUR/CAD: SHORT AT 1.3150 FOR 1.2950 OBJ, STOP 1.3245
GBP/JPY: LONG AT 153.10 FOR 160.40, STOP AT 154.70
NZD/USD: SHORT AT .8284 FOR A .8185 OBJECTIVE, STOP AT .8325


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EUR/USD Current price: 1.2938



Dollar ends the day higher across the board, with US indexes closing at new all time highs, and 10-year yields above 1.95%, something unthinkable a couple months ago: such strength in stocks should have lead to strong dollar selloff mounted on risk sentiment. But things are changing: market is turning more and more dollar bullish, as smart money moves to the US. Anyway, the EUR/USD traded as low as 1.2930 so far today, and despite the lack of follow through, the bearish potential remains intact.

The hourly chart shows indicators favoring a downward continuation, heading south below their midlines, while in the 4 hours chart 20 SMA presents a strong bearish slope, currently offering dynamic resistance around 1.3000, while indicators hold in negative territory: as long as below 1.2970 now, there’s scope for a test of 1.2880 area, which has been a major support/resistance over the past few months. A good amount of stops should lay below, so if triggered, the bearish momentum will likely accelerate over the upcoming sessions.
Support levels: 1.2910 1.2880 1.2840
Resistance levels: 129.70 1.3000 1.3030*

EUR/JPY Current price: 132.27



The EUR/JPY extended the upside towards 132.75 today, although approaches the end of the day barely changed from yesterday’s levels weighted by Euro self weakness. The hourly chart shows indicators turning back south above their midlines, while 100 SMA offers now dynamic support around 131.40 in case of more slides. In the 4 hours chart indicators hold in positive territory, although pretty neutral at the time being and pointing no strength. The pair may slowly grind higher on yen weakness, yet as commented on previous updates, range will prevail in the cross of two weak currencies.
Support levels: 131.90 131.50 131.00*
Resistance levels: 132.40 132.90 133.40

GBP/USD Current price: 1.5222



No rest for Pound as the GBP/USD continues falling in the American afternoon, and nears the 50% retracement of its latest bullish run around 1.5210, immediate support. Despite oversold according to the hourly chart, there are no technical signs of a reversal yet; the mentioned support may halt the slide, but if no bounce comes quick, chances of further falls increase, eyeing then 1.5130, 61.8% retracement of the same rally. In the 4 hours chart, technical readings maintain a strong bearish tone, supporting the shorter term view.
Support levels: 1.5210 1.5170 1.5130
Resistance levels: 1.5250 1.5290 1.5330

USD/JPY Current price: 101.75



The USD/JPY trades at levels not seen since August 2008, having reached 102.38 and one step closer to the 103.60 target proposed early week. The pair has managed to take over 102.00 and will likely maintain the level as buying interest continues to surge on any shallow retracement. The hourly chart shows momentum still heading higher, with distance in between 100 and 200 SMA widening more, which supports the pair current upward momentum. In the 4 hours chart technical readings gain bullish momentum in positive territory, also supporting more gains in the pair.
Support levels: 102.00 101.60 101.25*
Resistance levels: 102.40 102.90 103.30

AUD/USD: Current price: 0.9878



Aussie negative outlook has drove AUD/USD to post its 7-day-in-a-row slide, reaching so far 0.9876. Technically oversold in the hourly and daily chart, seems a bit too late to join the party, although nothing says the pair may have finally reached a bottom. Some consolidation at current levels could be expected, but short term spikes are still seen as selling opportunities up to 0.9950 in the short term.*
Support levels: 0.9870 0.9835 0.9790
Resistance levels: 0.9900 0.9950 1.0000*


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After the yen, the Australian dollar was the worst performer against the US dollar last month, while the euro was the best performer. This combination sent EURAUD from around 1.2220 to a high of around 1.3120. In recent days weak economic data out of Europe led to a slight pullback in the pair (eurozone GDP fell 0.2% according to advance Q1 figures and German Q1 GDP increased less than expected at 0.1%), and it is now flirting with a support zone around 1.3000. However, a break of this level may not be overly bearish in the long-term. A short-term correction downwards may be part of a broader upward trend (see chart).
Overall, the pair is holding steady in an upward trend. In the interim, a larger pullback isn’t out of the question as long as the pair holds in its current upward trend. In fact, RSI is pushing into overbought territory, which means a push lower/consolidation may happen at any time.
In the event of a push higher resistance may be found around:

• 1.3160 – prior resistance
• 1.3285 – shoulders of prior H&S pattern

Support may be found around:

• 1.2905 – high from April
• 1.2850 – prior support

Source: FOREX.com



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AUDCAD has continued to descend after breaking below the key 1.0300/25 level of support highlighted on May 6th.

This Aussie weakness has continued over the past 24-hours as AUDUSD broke below the 0.9860/90 support zone highlighted yesterday: 23.6% retracement, 200-week sma and triangle support.

Currently, AUDCAD is testing parity, with the 200-week sma just below around 0.9995. Considering AUDUSD broke below its respective 200-week sma overnight, it would not come as a major surprise to see AUDCAD follow suit. Furthermore, with weekly RSI’s repeated failure into the key 65 level over the past few years, it indicates the Aussie cross may be setting the stage for a continued downtrend.

That said, AUDCAD still sees a key long-term support zone at 0.9925/35, which sees the convergence of:

• 23.6% retracement (of the 2008-2012 rally)
• November 2009 high
• August & October 2010 lows
• October 2012 low

On the Canadian data front, keep an eye on tomorrow’s April Consumer Price Index (8:30am ET) – Market expectations are for a decline to +0.6% YoY from 1.0% in March. Should this occur, it could allow for a potentially more dovish bias from the new head of the Bank of Canada, and as a result weigh on the Loonie.
However, should 0.9925/35 give way, the next key support levels to focus on are 0.9635 (Jan. 2010 high & 2011 low), followed by 0.9400/05 (38.2%retracement of the 2008-12 advance) over the coming days/weeks.

Chart Source: Forex Charts by eSignal


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AUDUSD- next target?

Currently we are at 0.9733 on the 1.270 fibo. We are looking for a continuation down to the 1.618 Fibo support @ 0.9665. Market has a tendency to square up on Friday so be aware of that in the mix. The current average daily trading range (ATR) is 87 pips.




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The Kiwi has continued to decline over the past few days, largely following in the footsteps of the Aussie, and further downside could still be on the horizon. That said, this move may be attributed to not only USD strength, but also NZD weakness as the market has slowly been coming around to the notion we highlighted on Monday, “the implementation of such (macro-prudential) measures essentially takes the possibility of future rake hikes off the table, as Governor Wheeler could use this as an alternative to raising the official cash rate in order to stem a potential housing bubble…this may even give the RBNZ scope to further reduce rates in an attempt to fend off Kiwi appreciation.”

This NZDUSD weakness lead to a break below two key support levels: 0.8210/15 (38.2% retracement), followed by 0.8155/60 (2013 lows), and it’s currently testing another important support zone around 0.8055/65, which sees the convergence of the 50% retracement & November 2012 low.

Next potential levels of support if 0.8055 gives way:

• 0.8000 – Psychological & barrier/option related
• 0.7915/25 – 61.8% retracement & Sept. 2012 low
• 0.7835/40 – Channel’s measured move objective
• 0.7810 – July 2012 low

Although daily RSI has broken below 30, which denotes oversold territory, this is often characteristic of prolonged downtrends. A prime example of this was last May, whereby NZDUSD dropped over 700 pips, and daily RSI reached 17.27 before finally making a bottom – To put this in perspective, daily RSI is currently 24.17. Consequently, the old adage “don’t try to catch a falling knife, but rather wait until it’s stuck in the floor and then pick it up” may apply.




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EURUSD

What Forex Target Traders See: We are currently sitting @ 1.2828 on the Day chart trend line. This should be the bounce point. I am anticipating the trend shown but it has not been proven so it is just a hypothesis at this point. The bounce should initially go to the R4 @ 1.22979 then pull back to establish the longs and then target the R6 @ 1.3350 area. The average (14 day) daily true range (ATR) for the pair currently is 109 pips.*



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USDJPY

What Forex Target Traders See: We are currently @ 103.29 and the break of the R6 suggests a continues move to the 104.13 top. Should see a correction there to the 0.500 Fibo and the maybe another move north to the 1.270 Extension @ 104.87. The average (14 day) daily true range (ATR) for the pair currently is 102 pips.*



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GBPUSD

What Forex Target Traders See: Cable is currently @ 1.5167 and has been broken the 2.618 Fibo which continues its bearish posture. The next Day chart trend line to the downside is @ 1.5013. Look to the short side first to the1.5100 where we could get a correction and then continue to 1.5013. The average (14 day) daily true range (ATR) for the pair currently is 113 pips.


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AUDUSD – A great smooth currency for Newbie’s!

What Forex Target Traders See: Aussie is currently @ 0.9725. Expecting a pullback to the upside to complete wave 4 @ 0.9919 ( 0.618 fibo) and then another thrust down to the target @ 0.9596 area. The average (14 day) daily true range (ATR) for the pair currently is 101 pips.



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