Daily Forex Report: Swiss Franc to Take Over Euro’s Leading Strength?
By ActionForex
Dollar index extended the sharp decline to as low as 78.22 before recovering mildly. The broad based weakness in the greenback is still overwhelming in the markets but after all as the greenback is now sitting in side an important support zone of 75.89 to 80.38, some support should be seen in near term as the greenback approaches 61.8% retracement of 71.31 to 88.46 at 77.86. It’s unclear on whether dollar’s up trend has totally finished but some noticeable rebound should be seen on oversold condition in near term. The critical factor to determine dollar’s outlook will indeed be on whether another fall will be seen after the anticipated rebound to make the whole fall from 88.46 a five wave impulsive sequence, or will such fall complete in three wave corrective manner. This should be decided in the next few weeks and will set the tone for 2009. Read the rest of this entry »
Daily Pivots: (S1) 1.2695; (P) 1.2824; (R1) 1.3084
EUR/USD surges further to as high as 1.3080 in early US session and at this point, intraday bias remains on the upside as long as 1.2803 minor support holds. As discussed before, rise from 1.2423 should represent another rising leg of the consolidation that started at 1.2329 and further rally could be seen to 1.3290 or above. Though, upside is still expected to be limited below 1.3768 cluster resistance and bring down trend resumption. On the downside, below will turn intraday outlook neutral first. Further break of 1.2423 will indicate that such consolidation has likely completed and recent down trend is resuming for 50% retracement of 0.8223 to 1.6038 at 1.2131 next. Read the rest of this entry »
Daily Pivots: (S1) 1.2555; (P) 1.2628; (R1) 1.2689
EUR/USD’s strong rally in early US session suggests that rebound from 1.2389 is resuming. At this point, intraday bias is mildly on the upside as long as 1.2585 minor support holds. Further rise is in favor to 1.3290 high and 100% projection of 1.2329 to 1.3290 from 1.2389 at 1.3350 to complete the consolidation from 1.2329. Nevertheless, upside is expected be limited below 1.3768 cluster resistance and bring down trend resumption. On the downside, below 1.2585 will flip intraday bias back to the downside and break of 1.2389 will be an important indication that consolidation from 1.2329 has completed and recent down trend has resumed for next target of 50% retracement of 0.8223 to 1.6038 at 1.2131
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Daily Pivots: (S1) 1.2488; (P) 1.2672; (R1) 1.2955
EUR/USD’s strong rebound from 1.2389 indicates that an intraday low is in place and more importantly, it invalidated the triangle breakout scenario and suggests that consolidation from 1.2329 is still in progress. Intraday bias is flipped back to the upside and further rebound could be seen towards 1.3290 high. Though, there is no change in the broader view that price actions from 1.2329 is merely consolidation in the larger down trend. Upside of the current rise from 1.2389 is still expected to be limited below 1.3768 cluster resistance and bring down trend resumption. On the downside, below 1.2591 will turn intraday outlook neutral again. Further break of 1.2389 will be an important indication that recent down trend has resumed for next target of 50% retracement of 0.8223 to 1.6038 at 1.2131
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EUR/USD continued to engage in choppy sideway consolidation between 1.2329 and 1.3290 last week. As discussed before, with EUR/USD just missed 38.2% retracement of 1.4867 to 1.2329 at 1.3299, it’s believed that fall from 1.4867 has completed. Consolidation from 1.2329 is still in progress and is probably developing into triangle pattern. Nevertheless, in any case, firstly, as long as 1.2329 low holds, such consolidation could extend further. Secondly, in case of another rise, upside should be limited below 1.3768 cluster resistance. And more importantly, the path of the consolidation will remain unpredictable. Read the rest of this entry »
Daily Pivots: (S1) 1.2655; (P) 1.2851; (R1) 1.3177
EUR/USD’s rise from 1.2525 extends further to 1.3114 after mild retreat today. At this point, intraday bias remains on the upside as long as 1.2797 minor support holds. As discussed before, the corrective structure of the fall from 1.3290 to 1.2525 suggests that rebound from 1.2329 is resuming and further upside is in favor to retest 1.3290 high first. On the downside, though, below 1.2525 will flip intraday bias back to the downside for retesting 1.2329 low.
As discussed before, there is no doubt that a short term bottom is in place at 1.2329. With EUR/USD just missed 38.2% retracement of 1.4867 to 1.2329 at 1.3299, it’s believed that fall from 1.4867 has completed too and EUR/USD is developing into choppy sideway consolidation in the larger down trend from 1.6038. Note that the path and length of the current consolidation could be quite unpredictable. Nevertheless, firstly, intraday upside momentum should start to diminish again in 1.3258/3768 resistance zone even in case of another rise. Secondly, as long as 1.2329 low holds, such consolidation could extend further. A break out on either side is needed to confirm that the consolidation has completed.
In the bigger picture, as discussed before, the strength of the fall from 1.6038 reinforces the case that whole decline from 1.6038 is developing into a five wave impulsive fall. The completed decline from 1.4867 to 1.2329 might represent the third wave decline in the five wave sequence. Consolidation from 1.2329 might represent the fourth wave consolidation. Hence, another decline is still expected before making a medium term bottom. Below 1.2329 will target next long term fibonacci level of 50% retracement of 0.8223 to 1.6038 at 1.2131 or even further to 1.1639 key medium term support. On the upside, sustained break of 1.3768 cluster resistance (38.2% retracement of 1.6038 to 1.2329 at 1.3746) is needed to invalidate this view and indicate that whole decline from 1.6038 has made a medium term bottom.
EUR/USD Weekly Outlook
After edging lower to 1.2329 early last week, EUR/USD staged a strong rebound to as high as 1.3290. Even though EUR/USD weakens again towards the end of last week, it still ended the week higher. There is no doubt that a short term bottom is in place at 1.2329. With EUR/USD just missed 38.2% retracement of 1.4867 to 1.2329 at 1.3299, it’s believed that fall from 1.4687 has completed too and EUR/USD is developing into choppy sideway consolidation in the larger down trend from 1.6038.
Note that the path and length of the current consolidation could be quite unpredictable. Nevertheless, firstly, intraday upside momentum should start to diminish again in 1.3258/3768 resistance zone even in case of another rise. Secondly, as long as 1.2329 low holds, such consolidation could extend further. A break out on either side is needed to confirm that the consolidation has completed.
In the bigger picture, as discussed before, the strength of the fall from 1.6038 reinforces the case that whole decline from 1.6038 is developing into a five wave impulsive fall. The completed decline from 1.4867 to 1.2329 might represent the third wave decline in the five wave sequence. Consolidation from 1.2329 might represent the fourth wave consolidation. Hence, another decline is still expected before making a medium term bottom. Below 1.2329 will target next long term fibonacci level of 50% retracement of 0.8223 to 1.6038 at 1.2131 or even further to 1.1639 key medium term support. On the upside, sustained break of 1.3768 cluster resistance (38.2% retracement of 1.6038 to 1.2329 at 1.3746) is needed to invalidate this view and indicate that whole decline from 1.6038 has made a medium term bottom. Read the rest of this entry »
Daily Pivots: (S1) 117.57; (P) 121.09; (R1) 127.8
EUR/JPY’s rebound from 113.63 extended further to as high as 127.29, touching mentioned 4 hours 55 EMA. At this point, intraday bias remains on the upside as long as 118.13 minor support holds and further rebound could not be ruled out. Though, upside is still expected to be limited below 132.18 resistance and bring down trend resumption again. On the downside, below 118.13 will flip intraday bias back to the downside for retesting 113.63 low. Break will indicate recent fall has resumed for 200% projection of 169.96 to 147.03 from 156.84 at 110.98 next.
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Daily Pivots: (S1) 134.27; (P) 136.41; (R1) 138.03
EUR/JPY weakens further to 133.78 today and at this point, more downside is expected as long as 138.65 minor resistance holds. Retest of 132.19 low is in favor. Break will confirm that recent down trend has resumed for next long term fibonacci level at 129.46 (50% retracement of 88.97 to 169.96). On the upside, though, above 138.65 will suggest that consolidation from 132.19 is still in progress for another test of 141.73 before completion. But still, upside should be limited below 147.03 resistance and bring down trend resumption.
In the bigger picture, the sharp fall from 169.96 is still in progress and has taken out long term fibonacci level of 38.2% retracement of 88.97 to 169.96 at 139.02 without hesitation. The development so far suggests that fall from 169.96 is developing into a five wave decline and EUR/JPY is probably in the middle of it only. Medium term outlook will remain bearish as long as 147.03 support turned resistance holds and another fall is still expected even in case of correction, targeting 61.8% retracement of 88.97 to 169.96 from at 119.90.
EUR/USD’s rebound from 132.19 was limited at 141.73 and reversed. Further fall is now mildly in favor to retest 132.19 low. Break will confirm that recent down trend has resumed for next long term fibonacci level at 129.46 (50% retracement of 88.97 to 169.96). On the upside, though, above 138.96 will suggest that consolidation from 132.19 is still in progress for another test of 141.73 before completion. But still, upside should be limited below 147.03 resistance and bring down trend resumption.
In the bigger picture, the sharp fall from 169.96 is still in progress and has taken out long term fibonacci level of 38.2% retracement of 88.97 to 169.96 at 139.02 without hesitation. The development so far suggests that fall from 169.96 is developing into a five wave decline and EUR/JPY is probably in the middle of it only. Medium term outlook will remain bearish as long as 147.03 support turned resistance holds and another fall is still expected even in case of correction, targeting 61.8% retracement of 88.97 to 169.96 from at 119.90.
In the long term picture, the three wave corrective structure of the up trend from 88.97 (00 low) to 169.96 suggests that it’s merely a correction to the multi decade down trend from 285.56. The impulsive nature of the fall from 169.96 indicates that it’s likely resuming the down trend. Hence, 61.8% retracement of 88.97 to 169.96 at 119.90 should at least be reached with odds of extending the down trend further to retest 88.97 low in the long run.
