EUR to Extend Recovery; USD Weak

 
   By Francis Bray, CFTe MSTA 
   A DOW JONES NEWSWIRES COLUMN 
 

        LONDON (Dow Jones)--Rolling 24-hour chart levels:
        Intraday EUR/USD: The strong recovery from Wednesday's 1.1066 low is targeting a full retracement to last Friday's 1.1290 reaction high. Resistance a 1.1251 is under threat, which is the last line of defence protecting the 1.1290 high. The broader-term corrective recovery from the March and April lows at 1.0457 and 1.0520 respectively does have allowance to the 1.15 area, and a push above 1.1290 would open 1.1341. Strong support at 1.1147 indicates limited downside risk, which has protection at 1.1196.
        Weekly chart EUR/USD trend: Bullish.
        Intraday USD/JPY: Tuesday's bearish outside day tempers the double-bottom base that dominates the daily chart. Tuesday's rejection of a three-week high at 120.51 puts support at 119.72 under threat, and a push lower would expose 119.63 and 119.14/119.26. However, the double-bottom lows at 118.52/118.50 are not vulnerable at this stage. Recapturing ground above 120.15 is required to question the bearish outlook, opening 120.41 and the 120.51 high.
        Weekly chart USD/JPY trend: Range.
        Intraday GBP/USD: A bear trap was left at Tuesday's 1.5091 low, offering the opportunity to retrace some of the sharp decline from the Apr. 29 reaction high at 1.5496. Single prints at 1.5078 on the Market Profile chart have been successfully defended, and GBP bulls have resistance at 1.5240 and 1.5285 in their vision. However, only above 1.5335 would drag the 1.5496 peak out of the murky distance. Loss of support at 1.5120 is required to re-expose the 1.5091 low, threatening backup support at 1.5025/40.
        Weekly chart GBP/USD trend: Bullish.
        Intraday USD/CHF: Tuesday's push into eleven-week lows has further to go, as USD bears remain in full control. The powerful decline from Tuesday's bearish outside day at 0.9413 met one key downside objective at 0.9242, and a Head-and-Shoulders continuation pattern offers another objective at 0.9195. Congestive resistance between 0.9297 and 0.9335 would have to be broken in order to question the bearish outlook.
        Weekly chart USD/CHF trend: Bearish.
        Intraday EUR/GBP: The bounce from 0.7316 on Tuesday is set to extend to last Friday's ten-week high at 0.7416. It was Friday's push to 0.7416 that upgraded the recovery from the Mar. 11 reaction low at 0.7015, and a new wave equality target has been generated at 0.7496. That 0.7496 objective would become the focus on a break above 0.7443. Weakness will attract support while above 0.7350, and only below 0.7306/16 would concern EUR bulls.
        Weekly chart EUR/GBP trend: Bullish.
        Intraday EUR/JPY: Tuesday's successful defence of support at 133.12 drags last Friday's two-month high at 135.29 back into the immediate picture. A push above 135.29 is expected at this stage, opening the important 200-day and 260-day falling moving averages that lie at 135.69 and 135.95 respectively. Lower highs at 136.22 and 136.70 from February would then be opened. Support at 133.95 would have to be breached in order to lessen the upside threat, although only a reversal below 133.12 would concern EUR bulls.
        Weekly chart EUR/JPY trend: Bullish.
        Intraday EUR/CHF: The recovery from Tuesday's low at 1.0349 is likely to struggle regaining a secure foothold above the 1.04 level. That's because the rally is correcting the bear wave from the Apr. 30 reaction high at 1.0524, and resistance at 1.0410 on Wednesday's Market Profile chart ties in with a 1.618 Fibonacci extension target. The 1.0349 low will become vulnerable again on a break below 1.0363, threatening 1.0324.
        Weekly chart EUR/CHF trend: Bearish.
        Intraday AUD/USD: Bounces strongly from Tuesday's Asian session low at 0.7790, to consolidate the decline from last week's 0.8076 peak. The sharp turnaround from 0.7790 targets 0.7993, which is the last major line of defence shielding the 0.8076 high. Tuesday's buying tail low at 0.7790 has defence at 0.7840 and 0.7870.
        Weekly chart AUD/USD trend: Range.
        * 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

        May 06, 2015 02:42 ET (06:42 GMT)

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