• EUR/USD Tests Time and Price Symmetry Support
• 5-Wave Aussie Move Brings Channel Breakdown
• Some Aussie To Go Below the Figure

Volume is lightening despite traders squaring positions to avoid being caught among light holiday volume to go home flat for the weekend. We just watched EUR/USD hold the 1.2070 low from yesterday, which if you recall saw Fib time and price support at this level. The bids we spoke about yesterday appear to be there and more are rumored to be down into the 1.2025 level, which furthers our long EUR/GBP trade from yesterday. EUR/GBP has held the figure after repeated attempts and should the shorts decide to square for the weekend, we could see a decent 0.6920 + pop into the weekend.

Taking another look at the measured move AB=CD to the just recently tested 1.2070 level, the time symmetry component has been satisfied as we are now 31 bars into the CD leg as compared to AB leg. Notice the .707 retracement at 1.2062, which should cap further attempts to the downside. However, if the 60 level gives way, 1.2025 is just below where solid bids are likely to be found, again, furthering our long EUR/GBP.

Now back to trend trading among this strong dollar market. AUD/USD saw a spectacular failure from the 55-day SMA at 0.7335 combined with downtrend resistance that has sent price spiraling to a 0.7250 low. The overbought nature of the inset daily chart stochastics indicates further declines are likely. The larger, 3-hour chart concurs as we just recently saw a uptrend channel break after a 5-way accent into the daily 55 SMA. We appear to be in a correction wave a so a move back up to retest the breakdown point of 0.7280 should be considered a b leg for a push lower to c.

The 13-min (Fib Number) chart shows a setup that should be all too familiar to you. A move up to test the 0.7280-0.7290 breakdown point could be sold with stops above 0.7315 offering a low risk, high reward ratio targeting a move as far down as 0.7180.

Again, keep in mind that we are in holiday trading mode. which means trading desks are not fully staffed and the junior guys could be at the helm. Sharp, illiquid moves could be expected so keep on your toes if you are planning to dance.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

Disclaimer
The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.