Technicals
Australian Dollar Continues to Firm
Wednesday, 10 Mar 2010 1:52 EST at 13:52 by Jamie Saettele · Leave a Comment
Euro / US Dollar
A larger EURUSD rally, probably a 4th wave, may be underway towards 13870-14030. 4th waves are often choppy, usually flats or triangles. An impulsive rally from 13433 and corrective decline from 13738 may be complete. I cautiously favor the upside against 13530.
British Pound / US Dollar
After meeting resistance from former support / the 38.2% of the decline from 15825 / channel resistance, the GBPUSD has rolled over. I favor a drop below 14780 in a 5th wave. Risk can be moved to 15200. 15030 is resistance.
Australian Dollar / US Dollar
The AUDUSD is firm and while I am bigger picture bearish against 9334, the AUDUSD could continue to strengthen near term. 9170 and 9300 are potential resistance levels. A drop below 9050 is needed in order to suggest that the larger trend has turned back down.
New Zealand Dollar / US Dollar
As mentioned yesterday, it seems likely that the NZDUSD will exceed 7088 before the corrective advance from 6804 is complete. Price above 6959 keeps the NZDUSD on a path higher towards 7156. Action since 7088 could also be a triangle. 7015/30 is short term support.
US Dollar / Japanese Yen
Given the extent and structure of the USDJPY advance from 8813, it is possible that an A-B-C decline is complete from 9380. A move above 9217 would strongly suggest that the USDJPY is headed above 9380, which would indicate a breakout above trendline and channel resistance.
US Dollar / Canadian Dollar
No change: “The USDCAD has dropped below 10368 and to its lowest level since mid January. The potential for a bottom and reversal remain, especially since the decline from 10577 is now 161.8% of the decline from 10684-10491 and the decline from 10684 is 100% of the decline from 10784. Even if the decline from 10577 is a 3rd wave (rather than a c wave), a 4th wave correction would probably reach at least 10368.”
US Dollar / Swiss Franc
No change: “The decline from the 10900 high February can be counted as a 3 wave setback and the rally from the low (10646) may be an impulse. The other count is a double zigzag (a-b-c-x-a-b-c). Confusion reigns at this point and the key levels are 10646 and 10900. Until one of those levels gives way, the market remains in a range.”
Gold
No change: “Gold has traded sideways since December and appears to be building a bullish base. Specifically, the base could be a complex head and shoulders (the head itself is a head and shoulders). In order to complete the pattern, gold would sell off once more towards 1075 before finding a right shoulder low.”
Light Crude
Crude remains strong and the larger trend is considered up as long as price is above 6859 (under there completes a longer term head and shoulders top). Still, at least a setback looks likely near term as there are 5 waves up from the February low (and wave v is a diagonal). 8286-8350 is potential resistance from a gap. Expect weakness to at least below 7705. 7613 is potential support. It is possible that the rally from the February low completes wave C of an A-B-C flat. An impulsive decline from near current price would confirm as much.
Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Friday evenings), technical analysis of currency crosses on Monday, Wednesday, and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates at the DailyFX Forum. He is the author of Sentiment in the Forex Market. Follow his intraday market commentary and trades at DailyFX Forex Stream. Send requests to receive his reports via email tojsaettele@dailyfx.com.
