Saturday, April 2, 2011

FX Technical Weekly By Jamie Saettele, Sr. Technical Strategist and Joel Kruger, Technical Strategist

M RoC
BB
BBI
W RoC
BB
BBI
D RoC
BB
BBI
MPIV
EURUSD
1
1
2
1
1
1
1
GBPUSD
1
1
1
1
(1)
(1)
0
AUDUSD
1
1
1
2
2
1
1
NZDUSD
1
1
D
(1)
1
2
2
1
USDJPY
(2)
(1)
1
2
U
1
2
1
USDCAD
(1)
(1)
(2)
(2)
(1)
(2)
(1)
USDCHF
(2)
(1)
(1)
(1)
U
(1)
1
1
EURJPY
(1)
1
2
2
U
2
2
1
EURGBP
(1)
1
1
1
2
1
1
EURCHF
(2)
(1)
2
1
1
2
1
EURCAD
1
1
1
1
1
(1)
0
EURAUD
(1)
(1)
U
2
1
(1)
(1)
(1)
EURNZD
(1)
3
2
1
(1)
(1)
U
(1)
GBPJPY
(1)
1
3
2
1
2
1
GBPCHF
(1)
(1)
U
1
(1)
U
(1)
1
1
GBPCAD
(1)
(1)
1
(2)
(2)
(2)
(1)
GBPAUD
(1)
(1)
1
(2)
(2)
(1)
(1)
GBPNZD
(1)
(1)
2
(1)
`
(2)
(1)
(1)
AUDJPY
1
1
2
2
3
2
1
AUDCHF
(1)
(1)
1
1
2
1
1
AUDCAD
1
1
(1)
2
1
1
1
AUDNZD
2
2
1
1
(1)
(1)
(1)
NZDJPY
(1)
1
1
1
1
2
1
NZDCHF
(1)
(1)
(1)
(1)
2
1
1
NZDCAD
1
1
(2)
(1)
2
1
1
S&P
1
2
1
1
1
1
1
GOLD
2
1
1
1
1
1
1
SILVER
3
3
2
1
1
1
1
CRUDE
1
2
2
1
1
1
1
30YR
1
(1)
(1)
1
D
1
(1)
(1)
COPPER
1
1
(1)
(1)
(1)
(1)
(1)
CHARTS
-price bar chart
-base currency 10 yr interest rate in green
-counter currency 10 yr interest rate in red
-interest rate differential in black
-indicator that measures change in interest rate differential and change in price over 20 days is in blue (high levels indicate buying opportunities, low levels selling opportunities)-referred to as JSINT
- 14 day RSI
Euro / US Dollar
Daily
040111FXTW_body_eurusd.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – Short term trendline support in the EURUSD continues to hold and price is now testing the line that extends off of the tops above 16000 and 15000. Tops take time to form which is why I prefer to wait for a drop below 14020 OR an obvious blowoff top before committing to the short side. Upside objectives are at 14360 and 14413. Prior congestion extends to the 2010 high at 14579 as well. JSINT remains bearish below 0 and is not yet extreme.
Joel - The A closer look at the weekly chart shows the market failing ahead of some key resistance from November 2010 at 1.4280 and reversing to confirm a bearish weekly close and break of a sequence of 5 consecutive weekly higher lows. This certainly warns of the potential for deeper setbacks ahead, and we initially will look for a daily close back below 1.4020 to provide further confirmation for reversal prospects. The 1.4020 level loosely coincides with some rising trend-line support off the 2011 lows and a daily close below this level could accelerate declines towards next key support by 1.3750 further down. Back above 1.4280 delays.
British Pound / US Dollar
Daily
040111FXTW_body_gbpusd.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – Price tagged the 2nd standard deviation Bollinger band on Monday, signaling what may be the beginning of a larger decline. The sharp decline from 16400 is probably the beginning of larger wave D of the triangle that began at the 2009 low. Expect resistance at 16200 next week. JSINT is mildly bearish at just above 0.
Joel - The 1.6300 handle continues to be a difficult obstacle for bulls, with the market unable to hold above the figure for any meaningful period of time. As we had warned in the previous daily analysis, the market has once again rejected trading above the figure to set up a bearish reversal exposing deeper setbacks into the 1.5700 area over the coming sessions. Ultimately, only back above 1.6300 delays.
Australian Dollar / US Dollar
Daily
040111FXTW_body_audusd.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – Until an impulsive decline is visible from the high, I am not comfortable with the short side. There are some levels to watch for resistance on the upside, including a line extended from the November and December tops (just above current price) and 10423 (100% extension of 9536-10256 rally). JSINT is bullish but closing in on its 2nd deviation line, which warns of a top.
Joel - The break to fresh multi-year highs through 1.0300 certainly delays our bearish outlook and potentially exposes a move towards next critical resistance by 1.0500 further up. However, we continue to favor looking for opportunities to sell above parity, with the market viewed as technically and cyclically overdone and at risk for a major pullback over the medium-term. Initially however, look for a break and close back below 1.0300 to take immediate pressure off of the topside and open the door for a short-term bearish reversal.
New Zealand Dollar / US Dollar
Daily
040111FXTW_body_nzdusd.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The NZDUSD advanced for the 9th day in the last 11 and has entered a resistance zone defined by 7655 (2/18 high) and the underside of the support line from the 2009 low is just above 7700 as is the resistance line extended off of the November and February highs. The operative short term wave count is a double zigzag and the 2 zigzags would be equal at 7708. I favor shorting rallies into the mentioned resistance as close to 7700 as possible. JSINT has entered bullish territory (below 0).
Joel - The rally out from the mid-March 0.7100 area lows has been most impressive, with the market trading back above 0.7600 thus far ahead of the latest minor setbacks. However, any additional gains from here are seen limited, with the greater risk for some form of a medium-term lower top below 0.7800 in favor of a bearish reversal back towards and eventually below 0.7100. Look for a break and close back below 0.7580 to confirm and accelerate declines.
US Dollar / Japanese Yen
Daily
040111FXTW_body_usdjpy.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The USDJPY is up an astounding 10% from the March panic low. Having now traded above the late 2010 high of 8450, the probability of a more substantial drop is increased. In any case, resistance from a multiyear trendline is at 8660 next week and the rally from the low would consist of 2 equal legs at 8610. Support is at 8320 and 8250. JSINT is now bullish.
Joel - The market has recovered a great deal since basing out by fresh record lows at 76.30 several days back, with the price now back in the very well defined range that had dominated trade for much of the previous weeks. The key levels to watch above and below come in by 84.50 and 79.75 respectively, and look for a sustained break on wither side to provide additional clarity and insight into directional bias. In there interim, we recommend taking to the sidelines.
US Dollar / Canadian Dollar
Daily
040111FXTW_body_usdcad.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The USDCAD is at its lowest since November 2007 (the month of the all time low). The only point of reference from which to estimate support is a downward sloping trendline, which is at 9430 next week. 9680 and 9730 are resistance levels. JSINT is bearish (above 0).
Joel - Any recoveries in this market have been short-lived, with the price dropping back below 0.9700 in recent trade to test multi-month lows in the 0.9600’s. However, despite the weakness, we see risks for additional declines from here as limited, with the greater risk for the formation of a medium-term higher low in favor of the next major upside extension beyond 0.9975 and back above parity. Ultimately, only a daily close below 0.9600 would delay.
US Dollar / Swiss Franc
Daily
040111FXTW_body_usdchf.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The rally from the low is constructive but faces resistance from former congestion that extends to 9370. Support next week comes in at 9200 and 9120/50. JSINT has turned bullish. The Bollinger Band Inside day setup is visible on the weekly and price has held above the 20 day average for 5 days now. A move above 9400 is needed in order to break the trendline that extends off of the December 2010 and February 2011 highs.
Joel - The latest break to fresh record lows below 0.9000 (0.8910) is certainly concerning and threatens our longer-term recovery outlook. Still, we do not see setbacks extending much further and continue to favor the formation of some form of a material base over the coming weeks for an eventual break back above parity. Look for the market to hold above 0.9100 on a daily close basis, while back above 0.9370 will officially confirm reversal prospects and accelerate gains. Only a break and weekly close below the recent record spike lows at 0.8910 ultimately delays outlook.
Euro / Japanese Yen
Daily
040111FXTW_body_eurjpy.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The EURJPY has already reached its February 2010 low of 11964. There are several Fibonacci confluences that intersect with former chart levels. 12207-12338 is defined by the 100% extension of the rally from March’s panic low, the post 2010 flash crash high and the 161.8% extension of the rally from the 2010 low. The 12700 area is also of interest (161.8% and 200% extensions and April 2010 high). Near term support is 11870, 11790, and 11730. JSINT is bullish.
Joel - The market has finally taken out some critical multi-week range resistance in the 116.00 area and we believe this to be a significant medium-term development. The break above 116.00 now suggests that a major base is in place with fresh upside now projected back towards the 125.00 area over the coming days. In the interim, look for any inter-day pullbacks to be well supported ahead of 113.00.
Euro / British Pound
Daily
040111FXTW_body_eurgbp.png, FX Technical Weekly
Prepared by Jamie Saettele
Jamie – The time consumed since the early January low along with the break above long term trendline requires us to consider a more immediate bullish possibility. 8940 is now in focus and trading above there would bring an end to the series of lower highs since the December 2008 / January 2009 high. Any weakness should be analyzed in the event that it is corrective. Support comes in at 8750, 8715, and 8670. JSINT is bullish.
Joel - The latest sharp rally back above 0.8800 is concerning for our broader bearish outlook, with the market breaking back above a major falling trend-line from the 2009 peak. Should we see the market establish above the 0.8800 figure over the coming days, then expect to see more upside ahead with the overall structure shifting to the bullish side. Back below 0.8750 now required to officially alleviate topside pressures.

Source
http://www.dailyfx.com



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