• GBP/USD breakout
• USD/JPY holding 52 week average for now; watch 110.10
• USD/CAD revisiting range highs; next price zone is 1.3700-1.3838

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EUR/USD

Weekly (LOG)

Chart Prepared by Jamie Saettele, CMT

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I’ve noted long term EUR/USD bottoming conditions recently such as the key reversal in January, divergence with RSI (monthly and weekly) and the channeling decline. Price needs to take out the blue trendline in order to get bullish though because the rally from January is left as a 3 wave advance and ‘counts’ as a 4th wave within a 5 wave decline from the 2016 high. The implication is that a 5th wave lower is possible to at least 1.0200 (measured target based on wave 1 = wave 5).

GBP/USD

Weekly

Chart Prepared by Jamie Saettele, CMT

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Recent comments have noted that “GBP/USD has been trading sideways since the October crash in what may be a triangle. The end of the quarterly declines mentioned last week shouldn’t be forgotten however. “For the 3rd time in history, a string of 6 consecutive down quarters has ended (see here).” Cable resolved higher from the triangle and focus is towards at least 1.3400-1.3500. The 52 week average and the 9/30/2016 uncovered close at 1.2965/75 should be noted as a minor hurdle.

AUD/USD

Weekly

Chart Prepared by Jamie Saettele, CMT

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Every AUD/USD poke into .7700-.7800 over the last year has failed. The main consideration for resistance up there are from parallels. As long as price is below the parallel, longs are fighting an uphill battle. After the February top, I noted that “the dip could extend to the October and December 2015 highs at .7385.” That level is in play barring a breakout through the top of the range. I’ll note that 65 weeks have passed since the January 2016 low. The final low within the bottoming sequence in the early 2000s was 70 weeks from the initial low. Momentum is much weaker now than it was then but the timing is interesting.

NZD/USD

Weekly

Chart Prepared by Jamie Saettele, CMT

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Don’t forget about the 2015-2016 trendline just below .6800 in Kiwi. Bigger picture, I’m still non-committal. Is the rally from August 2015 countertrend or a new trend? The 2016 and YTD highs are at major resistance from the 2011 low and a double top target is still unmet at .5899. A break under the 2015-2016 trendline would suggest a good deal more downside. Until then, keep an open mind. It’s possible that Kiwi could work higher now as price has responded to a parallel 4 of the last 6 weeks. Above .7090 would be a good start. For more, check out this recent video.

USD/JPY

Weekly

Chart Prepared by Jamie Saettele, CMT

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The following was put forth in the USD/JPY Q2 forecast. “A major USD/JPY level could be met in April. The 52 week average (support and resistance for years) is near 108.30 and the 50% retracement of the decline is at 108.81 (the 1991 high was a 50% retracement of the 1990 decline by the way). The decline from the January high would consist of 2 equal legs at 108.49. This zone (108.30/81) intersects with the developing channel from the January high in mid-April.” The level has been met and there was no gap last week (had worried about that heading into last weekend). This week carved a key reversal but daily momentum considerations remains consistent with ‘selling strength’. I’d not get too excited about upside unless USD/JPY can establish over 110.10 (former lows).

USD/CAD

Weekly

Chart Prepared by Jamie Saettele, CMT

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USD/CAD of late is a great example of markets taking a complicated path to get to where you think they are headed anyway. Case in point, I wrote in January that “the USD/CAD rally from May 2016 is corrective so the bias is for impulsive weakness but the proximity of a long term parallel to the December high increases risk of a bull trap on a push through the horizontal level (failed breakout).” After the March turn, I thought that the top was in, noting that “the March high is a few ticks below the 52 week closing high so it’s possible that USD/CAD is ready for its next leg lower. Weekly RSI has been failing near 40 since late 2016 which is bearish behavior.” USD/CAD has revisited the highs so the bull trap possibility is back on the table. The long term parallel (support in October 2015 and resistance in late 2016) is near 1.3700. The 61.8% of the drop from January 2016 is 1.3838.

USD/CHF

Weekly

Chart Prepared by Jamie Saettele, CMT

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My USD/CHF focus has been on the trendline that originates at the September 2011 low. The line has been support on every touch since 2015 (including the US election). I lean bullish while above that line but a drop below would warrant turning bearish for a run at .9100 (next parallel relationship). Like EUR/USD (inverse), price followed through on the weekly outside reversal. The 55 week average was also support at the low. The bullish outside week and follow through is a great way to begin a directional leg but confidence in direction is low. The line that connects the 2012 and 2015 (twice) highs is resistance just below 1.0500.