EUR Rally Running Out of Steam; AUD Slides

 
   By Francis Bray, CFTe MSTA 
   A DOW JONES NEWSWIRES COLUMN 
 

        LONDON (Dow Jones)--Rolling 24-hour chart levels:
        Intraday EUR/USD: Short-term EUR bulls remain shy of a key upside target at 1.2621, despite Tuesday's push to a near four-week high. The subsequent setback from Tuesday's 1.2570 high is challenging support at 1.2478, and a deeper setback towards 1.2420 is threatened. That said, only below 1.2420 would damage the wave structure of the short-term rally from the Dec. 8 reaction low at 1.2247. A push into new session highs above 1.2516 would make the 1.2570 high accessible, although EUR bulls would then have to force a break above the Nov. 19 intra-wave lower high at 1.2602 to open the 1.2621 objective.
        Weekly chart EUR/USD trend: Bearish.
        Intraday USD/JPY: The strong bounce from 115.56 to 117.76 on Tuesday suggests the corrective bear wave from the Dec. 7 peak at 121.86 has run its course. A minimum downwave equality target at 115.10 has not been met, and USD bulls would strengthen the 115.56 low considerably on a break above the 117.76/118.15 resistance area. This would then allow for further gains to 118.63. It would take a reversal into new session lows below 116.30 to make the 115.56 low accessible again.
        Weekly chart USD/JPY trend: Bullish.
        Intraday GBP/USD: GBP bulls have been given a new lease of life, following Tuesday's push to a near three-week high. The upward breach of 1.5757 extends the recovery from the Dec. 8 reaction low at 1.5542, and a wave equality target at 1.5817 has been generated - in the vicinity of the Nov. 27 intra-wave lower high at 1.5824. That 1.5817/24 resistance area is now pivotal. Weakness will attract support while above 1.5660, defending Monday's higher low at 1.5602.
        Weekly chart GBP/USD trend: Bearish.
        Intraday USD/CHF: Pressure is building on projected resistance at 0.9636, following the strong bounce from a near four-week low at 0.9554 on Tuesday. The wave structure of the broader decline from the Dec. 8 peak at 0.9818 has shown reluctance to meet its downwave equality target at 0.9522 so far, and a break above 0.9636 would leave Tuesday's 0.9554 low as a pending bear failure, opening 0.9673 and 0.9700. A push into new session lows below 0.9596 would facilitate a return to the 0.9554 low, while keeping the bear tone intact.
        Weekly chart USD/CHF trend: Bullish.
        Intraday EUR/GBP: Tuesday's decisive bear hammer candle is expected to be cemented on a break below 0.7936 during Wednesday's session. The sharp rejection from Tuesday's near four-week high at 0.8002 means the 0.8017 minimum upside requirement target was not met, and a break below 0.7936 and 0.7908 would cement the bull failure at the 0.8002 high, exposing 0.7875. The 0.8002 high would only become accessible on a break above 0.7976.
        Weekly chart EUR/GBP trend: Range.
        Intraday EUR/JPY: A trading range between Tuesday's low at 144.96 and resistance in the 147 area is developing. Tuesday's initial push lower to 144.96 met an important equality target at 145.06, to validate the short-term bear wave from the Dec. 8 peak at 149.79. Internal support has emerged at 145.55 to indicate a test of resistance at 147.00, and a concerted push higher would open 147.61. Failure to keep 145.55 support intact would spark a fresh attack on the 144.96 low.
        Weekly chart EUR/JPY trend: Bullish.
        Intraday EUR/CHF: The SNB floor at 1.20 remains within striking distance, and the tone is still dominated by last Thursday's bearish outside day. A downwave equality target lies at 1.2006, although the structure of the decline from the Dec. 2 high at 1.2046 suggests the 1.20 level will come under a barrage of bear pressure. However, it is unlikely that the 1.20 level will be decisively breached. Thursday's key high at 1.2038 would have to be exceeded in order to put EUR bulls in control, which has protection at 1.2020.
        Weekly chart EUR/CHF trend: Bearish.
        Intraday AUD/USD: New four-and-a-half year lows below 0.8200 are being set during Wednesday's Asian session, and more weakness is expected. The powerful bear wave from the Nov. 17 intra-wave lower high at 0.8797 has the minimum objective at 0.8140 in its sights, and there is additional downside risk to 0.8040 on concerted weakness. Corrective upside risk will be severely hampered by the 0.8209/21 resistance cluster.
        Weekly chart AUD/USD trend: Bearish.
        * The pivot is the sum of the high, low and close divided by 3.
        For more technical analysis see: Dow Jones Newswires, N/DJTA; Bloomberg, NI DJTA; and Reuters key word search "INSI-DJN"
        By Francis Bray; Dow Jones Newswires; +44 (0)207 842 9249; francis.bray@dowjones.com
        Francis Bray is Dow Jones' chief technical analyst for Europe, and has worked as a technical analyst and trader for 20 years in London, Barcelona and Guernsey.
        Data provided by CQG International Ltd.
        This is a financial news and information service. It is provided in general terms and does not take account of or address any individual user's position. To the extent that this article includes suggestions as to various possible investment strategies which users might consider, it does so in only general terms without reference to the personal factors which should determine any user's investment decisions. Nothing contained in this service constitutes personalized investment advice. Dow Jones does not warrant the accuracy, completeness or timeliness of the information in this article, and any errors shall not be made the basis for any claim against Dow Jones. The author does not invest in the instruments or markets cited in this article. This article does not constitute or form part of any invitation or inducement to buy or sell any security.
        (END) Dow Jones Newswires

        December 17, 2014 02:19 ET (07:19 GMT)

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