Bears push back into the psychological 1.0000 level.
USD/CAD bears have pushed back into the all-important psychological 1.0000 level (prior trading range).
Only a sustained close beneath here will extend bearish setbacks into the long-term 200-day MA at 0.9813.
Meanwhile, positive momentum needs to push above 1.0264 and 1.0400 to extend the recovery higher above the old resistance level at 1.0673 (August high & Congestion zone).
A strong directional confirmation above here will open a much larger recovery into 1.0850 plus. This would extend the upside breakout from the rate’s ending triangle pattern, which was part of a major Elliott Wave cycle. Elsewhere, EUR/CAD is extending above its 200-day MA, within a large multi-month trading range. Key resistance continues to hold at 1.4379 (June swing high), which has for some time marked a strong distribution pattern.
CHF/CAD is retesting its support nearby the 200-day MA at 1.1265, following the dramatic price slide lower (triggered by the SNB intervention). The cross-rate has now retraced more than half of its 2011 gains.
AUD/USD
Bulls reverse higher above 200-day MA and target 1.0765.
Exited Short at 1.0510. AUD/USD bulls reversed back higher above its 200-day MA and is now targeting next resistance at 1.0765 (01st Sept high).
In terms of the big picture, failure to hold above the 200-day MA will resume downside pressure on the rate’s multi-year uptrend.
The bears need to confirm beneath 1.0322 (26th Oct low) and 1.0188 (18th Oct low). A break here will unlock sharp setbacks into 1.0000.
Elsewhere, the Aussie dollar remains stable against the New Zealand dollar.The pair is still locked within its new bear cycle structure while it holds beneath its 200-day MA. Key support can be found at 1.2320 and 1.2100.
The Aussie dollar is also gaining against the Japanese yen, after pushing back above resistance at 80.00. Near-term support continues to hold at 77.6350 (18th Oct low). A break here will resume downside scope into76.7000.
GBP/JPY
Range bound short-term, favouring a return to 122.65.
GBP/JPY saw a minor break under 120.34 which failed to hold, reaching 120.00. This is suggestive of the potential for a further recovery leg higher to test the region near 123.00.
The structure present since 116.84 is deemed corrective, with scope for a final swing higher to complete this corrective phase. However, a sustained push under the recent low at 120.00 will warn of resumption of weakness back towards the floor near 117.00. However, an eventual return to
116.84/98 is expected, below which would open up an extension towards 115.00 immediately.
A sustained break over 123.31 is required to change the current bearish bias. Should this take place a larger corrective phase higher would then beanticipated.
EUR/JPY
Consolidates above the 104.75/104.99 floor.
EUR/JPY continues to range just above the 104.75/99 floor, following initial support over the last few sessions. Provided this floor is not breached, scope is seen for a fresh swing higher to re-test the 107.68 level.
However, the larger structure present since 114.18 favours the formation of a lower high close to 108.03, for a return to re-test 100.76.
Failure to hold under 108.03 will warn of a larger recovery structure, negating our medium-term bearish bias. Also, if a push over 108.03 can be sustained this will bring into focus a potential false break lower out of a falling channel in the daily timeframe.
A move under the annual low would open up an extension to 97.50, ahead of 92.80, levels not seen since 2000.
Please see the attached chart below.