EUR/USD ââ,¬â€œ The EURUSD rally through the 1 month (now former) resisting trendline turned the shorter term picture bullish. The key word in that sentence is turned ââ,¬â€œ as in past tense. The break of the trendline occurred at 1.2600 and the pair has pushed to 1.2669 since. Key resistance from the 61.8% of 1.2829-1.2483 at 1.2697 is just above and overbought hourly and 240 minute oscillators suggest that the pair is closer to a short term top than bottom. Support is now focused on a trendline from the 1.2524 low. That line is at 1.2594 now and increases 2 pips per hour.
USD/JPY ââ,¬â€œ From yesterday - ââ,¬Å"Yesterdayââ,¬â"¢s doji candle on the daily and the failure of the pair to reach 119.87 gives scope to a near term decline. Yesterdayââ,¬â"¢s high at 119.65 is now resistance. Price does remain above the 5 month supporting trendline. That line is at 117.80 today and increases about 9 pips per day. It would take a definitive break of that line (2 day close) in order to suggest that the larger trend has turned lower.ââ,¬Â� The JPY has found bids as it has gained to below 119.00 against the dollar and currently is testing the 61.8% of 118.02-119.65 at 118.65. The 61.8% is key support but it takes a push above the 119 figure to suggest that this decline is over. The next support level is the 10/19 low at 118.02.
GBP/USD ââ,¬â€œ Cable is approaching resistance from the 10/20 high at 1.8859. Much like the EURUSD, GBPUSD is overbought on the hourly ââ,¬â€œ which makes being aggressively bullish here rather risky. Still, a push above 1.8859 targets the 10/3 high at 1.8897. On a setback, look for support near the short term trendline from 1.8672 (see below). That line is currently at 1.8780. A breech of that line would begin to turn the short term picture bearish again.
USD/CHF ââ,¬â€œ The 10/19 low at 1.2546 is still support. If breached, then focus shifts to the 61.8% of 1.2288-1.2769 at 1.2472. A decline near there would complete a 3 wave correction of dollar strength and possibly give way to the next leg up for the dollar. Initial resistance on a rally attempt is at the 10/25 low at 1.2623.
USD/CAD ââ,¬â€œ The USDCAD remains stuck in the 1.1200-1.1320 range. The impulsive look of the 1.1413-1.1202 decline keeps short term wave structure bearish as long as 1.1413 holds. Initial resistance is at a potential resisting trendline near 1.1279. A rally through 1.1279 gives scope to a test of the 10/24 high at 1.1322. A drop below the 1.1200 figure may see offers hit until the 78.6% of 1.1085-1.1413 at 1.1155 (10/2 low at 1.1144 reinforces support there).
AUD/USD ââ,¬â€œ The AUDUSD appears to be topping out. A clear 5 wave rally has taken place from .7413 thus probability favors a move lower. Initial support is at the 10/24 low at .7559. Bearish divergence with hourly oscillators at todayââ,¬â"¢s high and hourly RSI declining from above 70 favors the topping scenario. Only a drop below .7559 instills confidence in a confident bearish stance. Resistance on a rally through todayââ,¬â"¢s high at .7636 is at .7655.
NZD/USD ââ,¬â€œ The reversal opportunity that we have focused on for the last week has played out and the larger picture is turning bearish due to the break below the 4 month trendline. The pair has slipped to a shelf of support just below .6550 (10/9 and 10/16 lows at .6539 and .6545). If support fails, then focus shifts to the 10/2 low at .6486. A break below .6486 should be a clue that a larger reversal is underway way. Former intraday support (yesterday) at .6588 is now resistance.
Jamie Saettele is a Technical Currency Analyst for FXCM.