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Currency Pair Overview:
Majors Lacking Momentum In Asian Session
Overall, the major pairs meandered along during the Asian session. The pound has strengthened the most by gaining 20 pips, while being closely followed by the aussie and the yen. Today, in Japan the retail sales report was released which has shown that sales declined 1.4% on the year in September.
The euro (EUR/USD 1.4802) has spent the Asian session trading below the neutral swing point at 1.4830 which coincides with where the 20 day moving average is located. Late in the US session the pair put in a level of support at 1.4765 while resistance remains near the 1.4930 area.
The pound (GBP/USD 1.6372) has been trading above the 100 day moving average at 1.6363 during the session. The pair will run into resistance at 1.6440 which is the high of the previous day and also the R1 swing level. Once the 1.6500 area is breached the pair is clear to test the 1.6680 again.
Trade Plan of the Day: TheLFB Trade Plan is USD/CAD, one of the six that are available to members on the major pairs each day, plus four Jpy based cross pairs, plus S&P futures, oil, gold, and the dollar index.
The aussie (AUD/USD 0.9160) has crossed above the neutral swing point at 0.9160 during the Asian session. The pair has had a hard time breaking either the daily swing resistance or swing support levels for the past several days. Support for the pair is seen at 0.9110 while major resistance is still seen at 0.9330.
The cad (USD/CAD 1.0648) has been meandering along under the neutral swing point at 1.0670 which is approximately 30 pips below the 50 day moving average which is located at 1.0700. The pair traded within a tight range over the past day not breaking below the neutral swing point or above the 50 day moving average for very long. These levels would need to be broken for the pair to move in either direction.
The swissy (USD/CHF 1.0216) is currently oscillating around the 20 day moving average at 1.0210 and the neutral swing point which is a mere three pips below that. The pair put in a new level of resistance at 1.0255 while intermediate support is seen at 1.0140.
The yen (USD/JPY 91.68) is currently testing the S1 support level at 91.60 during the overnight session. Over the previous day the pair has traded as high as 92.34 were to send fallen 70 pips to trade just above the 50 day moving average at 91.40. Should that support level be broken the pair will hit the 20 day moving average at 90.30 before finding heavy support.
TheLFB Charting: Gold Elliott Wave view
4 Hour chart trend: Long. Main price points: 1043, and 1070. Looking for: Wave 4)
Gold has finally broken through the 1043 support zone of wave A, we disscussed here recently. This break-out put the current wave C in play, where traders may see another 25-30 dollar drop over the coming days, to hit the 38.2% Fibonacci retracement zone, of a red wave 3) distance. In this area is also shown a trend-line connected from August to this month lows, which may be a good support area for another bounce higher.TheLFB Charting: S&P Futures Elliott Wave view
4 Hour chart trend: Long. Main price points: 1062.50, and 1098. Looking for: Wave 5) top
S&P futures fell powerfully on Monday, exactly into the 1062.50 support region we discussed here last week. This area needs to be taken out for a down-trend continuation with our primary wave count, which will suggest that the top is in. Traders however, should also be watching the alternative wave count where a move higher in wave Y may be the case if the current support around 1062 with wave X holds. This is a swing point of great importanve, and may be guided by earnings momentum to move long, or worries in the financial sector to move short.
TheLFB Charting: EUR/USD Elliott Wave view
4 Hour chart trend: Long. Main price points: 1.4816, and 1.5062. Looking for: Break through 1.4816
EUR/USD exploded lower in the previous session, driven by lower by falling stocks and gold prices. The lower support line of an ending diagonal was broken at that time, just before prices declined for more than 160 pips.
This could be the start of a new trend now that the wave five top is in place at 1.5062 area.
Patient traders will wait on a break of the 1.4816 support zone, which will be the reason for a five wave structure in current red wave I, that will suggest that the top is in, and that technically the euro will find sellers more easily than buyers.