USD & JPY look like they want a fight…

kevinmhughes

Last week was a a great week for the bulls across all asset classes (Euro bulls for FX).  The DOW closed the the week up 2.8%, the $EURUSD had some life to it and with $CL_F being backed into a corner for the last couple of weeks it started to fight its way out.  But will that all hold true for this week?

Below is my analysis of the $EURUSD, $AUDUSD & $USDJPY.  As always, it’s based purely on technical analysis, no fundamentals.

$EURUSD

On the daily chart, I’m seeing a bearish wedge forming.  I do believe we will test the 1.2200 handle before a retracement.  If the $EURUSD breaks below the 1.2050 level and holds, we should run to the 1.1900 handle.  After that I would predict support being 100 pips down.  If the $EURUSD strength were to continue into this week and we close above 1.2200, the next resistance is looking like 1.2400 (from there I believe we’ll hit 1.2500 then plummet to ‘post’ flash crash levels (1.1800 area first then to 1.1500).

$AUDUSD

We have seen some HUGE ranges in the $AUDUSD over the last several weeks.  The hangman that formed on Friday shows me that the pair is going to do a reversal (alng with $NZDUSD & $CL_F).  I believe we will more than likely test the .8300 level again before the bulls get back in the game.  If the pair were to get above the .8525 level, it’s off to the .8700 level.

As always, watch the price action in $CL_F.

$USDJPY
As you can see from the chart, I’ve outlined what I believe is to be a bearish wedge.  We’ll probably test the 92.00 level (it’s not that far off) before the Yen strengthens and we run to 90.00.  With a CONFIRMED break out above 92.00 (must be a decisive move, probably couldn’t be confirmed before Tuesday or Wednesday) we’ll see 93.00.

Based on what I see in my charts, the $USDX and $JPY will strengthen in the beginning of the week which will bring down equities & $CL_F.  The gaps will occur tonight when the FX market opens will be the tell tail sign of what the rest of the week looks like.

Tomorrow night AT 9:00 pm on the ‘Forex Report’ on StockTwits TV I will go over the revised levels (if any).


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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