Euro 1.3371 Key For Bulls
Commentary: The push through 1.3437 signals that wave iii, of a 5 wave rally that began at 1.3261, is underway. An objective is 1.3656, the 161.8% extension of 1.3261-1.3437/1.3371. Watch the 1.3550 area for resistance as well. The 6/5 high is 1.3552 and the 100% extension is at 1.3547. A break above 1.3472 would be a strong indication that a ‘3rd of a 3rd’ is underway (these are often the strongest moves).

Strategy: Bullish, against 1.3371, targeting 1.3656

Japanese Yen Correction Towards 122.15
Commentary: The pullback that we have warned of is underway right now and there is potential for a drop to the channel support line, drawn off of the 4/19 and 6/8 lows, near 122.00/15. The longer term bull trend is bullish above 120.76 but coming under 120.76 (as well as channel support near 122.00) would indicate additional bearish potential.

Strategy: Look for bullish opportunity close to 122.00/15 channel support, stop and reverse just below 120.76

British Pound To Move Lower to Complete Correction
Commentary: We are still looking for a bigger pullback, to channel support near 1.9885/9900. It is unclear whether or not the decline from 2.0005 is a larger 4th wave or an a-b-c correction as part of a larger 2nd wave. Either way, we are expecting a decline near term before a rally to a new high.

Strategy: Bearish now, against 2.0005, limit and reverse at 1.9900

Swiss Franc 1.2320 Support (USDCHF Resistance)
Commentary: As mentioned here yesterday, “the decline from 1.2424 looks more like a 3rd wave than a wave c, thus we are abandoning the bullish stance.” Near term, it looks like a 4th wave correction is unfolding. There is potential for a spike through 1.2309 before a decline in a small 5th wave towards 1.2225. Resistance on a spike through 1.2309 is the 38.2% of 1.2424-1.2258 at 1.2321.

Strategy: None

Canadian Dollar 1.0700 Holds Own
Commentary: There is no change to our outlook for the USDCAD. “Price is approaching potential channel resistance, which is just below 1.0800. We are looking for this correction to continue towards channel resistance before a 5th wave decline brings the USDCAD below 1.0548.”

Strategy: None

Australian Dollar .8515/30 Resistance
Commentary: The short term wave structure is unclear but the series of lower highs keeps us looking higher. The short term trend is considered bullish as long as price is above .8428 but watch for resistance in the .8515/31 area. This is the 127%-138.2% of .8476-.8332. If the rally stalls in the .8515/31 area (or before), then we will assume that the rally from .8332 is the b wave in an irregular flat correction. The next move would be a decline towards .8332.

Strategy: None

New Zealand Dollar Short-Term Bearish
Commentary: The rally from .7452 may also be the b wave of an irregular flat correction. If this is the case, then price is likely to fall from close to current price towards .7452. The measured objective for the end of wave b is .7687/.7708, which is the 127%-138.2% of .7637-.7452. Daily RSI is overbought and divergent with the recent high as well.

Strategy: None

Jamie Saettele is a Technical Currency Analyst for FXCM.