Price & Time: Yen Sentiment Again At Extremes

| 31 december, 2013 | 0 kommentarer

Talking Points

  • JPY sentiment at historical extremes
  • EUR/USD at important cyclical inflection point
  • AUD/USD recovers from key Gann level

To receive other reports from this author via e-mail, sign up toKristian’s e-mail distribution list via this link.

Looking for real time Forex analysis throughout the day? Try DailyFX on Demand.

Foreign Exchange Price Time at a Glance:

Price Time Analysis: EUR/USD

PT_DEC_31_body_Picture_3.png, Price amp; Time: Yen Sentiment Again At Extremes

Charts Created using Marketscope – Prepared by Kristian Kerr

  • EUR/USD failed near the1.3895 61.8% retracement of the 2009/2010 decline on Friday
  • Our near-term trend bias remains higher in the exchange rate while over 1.3655
  • The 1.3895 level and the 50% retracement of the 2008/2010 decline at 1.3955 are major upside attractions that need to be overcome if the Euro is to embark on a more important move higher
  • An important long-term cycle is in effect over the next few days
  • A move under the 2nd square root relationship of the year’s high at 1.3655 will turn us negative on the Euro

EUR/USD Strategy: Favor the long side while over 1.3655

Price Time Analysis: AUD/USD

PT_DEC_31_body_Picture_2.png, Price amp; Time: Yen Sentiment Again At Extremes

Charts Created using Marketscope – Prepared by Kristian Kerr

  • AUD/USD found support again on Monday at the 9th square root relationship of the October high near .8860
  • Our near-term trend bias remains lower in the Aussie while below .8965
  • A daily close below .8860 is needed to signal a resumption of the broader downtrend
  • A minor cycle turn window is seen early next week
  • A daily close over the 8th square root relationship of the October high at .8965 would turn us positive on the exchange rate

AUD/USD Strategy: Like the long side on a move through .8965.

Focus Chart of the Day: USD/JPY

PT_DEC_31_body_Picture_1.png, Price amp; Time: Yen Sentiment Again At Extremes

The Daily Sentiment Index (DSI) in the Yen fell to just 7% bulls on Friday. Historically such low levels of sentiment have been a reliable precursor to corrections in USD/JPY. Interestingly at the same time this extreme in sentiment is occurring the exchange rate is close to important long-term resistance in the form of the 61.8% retracement of 2007/2011 decline near 105.60. The missing ingredient for a correction is cyclicality, though a case could be made for a Gann turn window here if one uses the late October low (45 trading days from 10/25 was yesterday). A Gann angle line related to the 2011 low is at 103.90 and we are using this as a key near-term support level. If the exchange rate cannot get through 105.60 over the next few days and falls below 103.90 we will turn much more negative on USD/JPY.

To receive other reports from this author via e-mail, sign up toKristian’s e-mail distribution list via this link.

Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved

To contact Kristian, e-mail [email protected]. Follow me on Twitter @KKerrFX

Taggar: ,

Kategori: Analys från DailyFX

Om skribenten ()

DailyFX från FXCM ger dig dagligen färska tekniska analyser på valuta och råvaror. FXCM är en ledande handelsplattform för trading av finansiella tillgångar med kraftfulla verktyg för alla sorters handel.

Lämna ett svar

Din e-postadress kommer inte publiceras. Obligatoriska fält är märkta *