EUR Stabilizing: USD Corrects Lower

 
   By Francis Bray, CFTe MSTA 
   A DOW JONES NEWSWIRES COLUMN 
 

        LONDON (Dow Jones)--Rolling 24-hour chart levels:
        Intraday EUR/USD: Sustains the recovery from Monday's twelve-year low at 1.0457, although key resistance at 1.0685 remains out of reach. Monday's recovery was capped at 1.0620, guarding 1.0665 and last Thursday's lower high at 1.0684, where the mid-point of last week's bearish marubuzo candle lies. Loss of 1.0529 and 1.0485 would drag the 1.0457 low back into the immediate picture, and the broader powerful downtrend still has a key downside objective at 1.0361 to meet.
        Weekly chart EUR/USD trend: Bearish.
        Intraday USD/JPY: The completed drawn-out bull wedge continuation pattern on the 60-minute chart offers two upside objectives at 121.78 and 122.00. This comes hot on the heels of a bear failure low at 120.65 last Thursday, and yet, there is a reluctance to challenge the near eight-year high at 122.04 that was set on Mar. 10. That said, it would require a break below 121.09 to put USD bears in control of the near-term, exposing 121.02 and 120.82, while dragging the 120.65 low into the immediate picture.
        Weekly chart USD/JPY trend: Bullish.
        Intraday GBP/USD: The recovery from Friday's near five-year low at 1.4700 reached 1.4852 on Monday, but is still shy of key resistance at 1.4925. A break above 1.4925 is required to give the recovery credence, while re-opening the 1.50 level. However, it was Friday's downside break into near five-year lows that created the damage that will be felt longer-term, because a new bear signal for the May 2010 higher low at 1.4229 was issued. The 1.4700 low would become exposed on a break below 1.4790 and 1.4725, threatening a downtrend extension.
        Weekly chart GBP/USD trend: Bearish.
        Intraday USD/CHF: The ceiling of the three-day trading range between 0.9982 and 1.0128 is under threat. Last Thursday's eight-week high at 1.0128 marks a temporary peak of the strong medium-term uptrend, while the buying tail on the Market Profile chart at 0.9982 that same day indicates there is strong support at sub-parity levels. The broader uptrend has objectives at 1.0220 and 1.0295 to meet, which would be opened on a clean break above 1.0128. The 0.9982 floor has protection at 1.0051 and 1.0038.
        Weekly chart USD/CHF trend: Bullish.
        Intraday EUR/GBP: Support at 0.7105 is braced for renewed pressure, following the successful defence of Friday's 0.7171 high. Friday's bearish gravestone doji high at 0.7171 marks the peak of the recovery from last Wednesday's seven-year low at 0.7015, although it should be noted that the advance did break down into a five-wave Elliott Wave, offering EUR bulls broader-term basing hopes. Loss of 0.7105 would expose 0.7060 and 0.7050, which has the responsibility for preventing the 0.7015 low from re-exposure. Recapturing ground above Monday's 0.7163 high would lift the near-term tone, opening 0.7171 and threatening further recovery towards 0.7225.
        Weekly chart EUR/GBP trend: Bearish.
        Intraday EUR/JPY: Friday's near two-year low at 126.91 will remain vulnerable while resistance at 129.05 caps the upside. Monday's recovery successfully defended the 129.05 lower high, and support at 127.65 is set to come under pressure. Support at 127.65 is the last line of defence protecting the 126.91 low, and renewed bear pressure on 126.91 would threaten a downtrend extension towards the June 2013 higher low at 124.94. However, keeping support at 127.65 intact would enhance an inverse Head-and-Shoulders base formation on the 60-minute chart, and a break above 128.65/128.80 would complete the short-term base, opening 129.05 and the 130 area.
        Weekly chart EUR/JPY trend: Bearish.
        Intraday EUR/CHF: The recovery from Friday's low at 1.0518 is putting pressure on the 1.0682/1.0700 resistance area. The strong bounce from 1.0518 suggests a bull flag continuation pattern is forming on the daily chart, and a sustained break above 1.0700 would lift the tone further, opening 1.0730 and 1.0749. Weakness will attract support while above 1.0580, defending the 1.0518 low.
        Weekly chart EUR/CHF trend: Bearish.
        Intraday AUD/USD: Continues to hold above the important 0.7610 support level, to protect last week's near six-year low at 0.7560. However, the consolidation phase above that 0.7560 low is counter-trend, and last Thursday's high at 0.7731 would only be re-opened on a break above 0.7708. The bear wave from the Feb. 26 lower high at 0.7914 seeks a break below 0.7560, threatening 0.75 and generating a downwave equality target at 0.7275.
        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.
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        (END) Dow Jones Newswires

        March 17, 2015 03:21 ET (07:21 GMT)

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