Filed Under:
  • EUR/USD trades to highest levels since February
  • USD/JPY holds a major support level
  • The S&P 500 overcomes critical “time resistance”
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Foreign Exchange Price & Time at a Glance:

Price & Time Analysis: EUR/USD

PT_game_body_Picture_4.png, Price & Time: Was that the Game Changer?Charts Created using Marketscope – Prepared by Kristian Kerr

  • EUR/USD overcome the 6th square progression of the year-to-date low near 1.3325 on Wednesday to trade to its highest levels since early February
  • While above 1.3475 our near-term trend bias will remain higher in the exchange rate
  • Some minor resistance is seen around 1.3570, but the real upside attraction looks to be a convergence of several key Gann and Fibonacci levels near 1.3600
  • A minor turn window is seen early next week, but a more important one is eyed around the 1st week of October
  • Interim support is seen around 1.3500, but only aggressive weakness below the 2nd Gann square root progression of the year’s high at 1.3475 would turn us negative on the single currency
EUR/USD Strategy: Like the long side while above 1.3475.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

EUR/USD

*1.3475

1.3500

1.3555

1.3575

*1.3600

Price & Time Analysis: USD/JPY

PT_game_body_Picture_3.png, Price & Time: Was that the Game Changer?Charts Created using Marketscope – Prepared by Kristian Kerr

  • USD/JPY came under aggressive downside pressure on Wedesday, but held above important support in the 97.55 area
  • A close back above 98.75 on Thursday will re-instill the near-term positive trend bias
  • Gann related upside pivots at 99.65 and 100.65 need to be overcome to setup more important mover higher in the exchange rate
  • A minor turn window is seen on Friday
  • Only a close below major Gann support at 97.55 would turn us negative on USD/JPY
USD/JPY Strategy: Like buying on weakness against 97.55.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/JPY

*97.55

98.65

98.85

99.65

99.95

Price & Time Analysis: AUD/USD

PT_game_body_Picture_2.png, Price & Time: Was that the Game Changer?Charts Created using Marketscope – Prepared by Kristian Kerr

  • AUD/USD overcam important Gann resistance at .9425 on Wedesday to trade to its highest levels in three months
  • While above .9290 the near-term trend bias will remain positive in the Aussie
  • The 6th square root progresion of the year’s low at .9545 is a clear upside attraction with strength above needed to maintain the immediate upside tack
  • The cycle turn window has shifted out a few days and the first half of next week now looks like the most likely time for a turn
  • Aggressive weakness below Gann support at .9290 would undermine the immediate positive tone and turn us negative
AUD/USD Strategy: Like the long side while over .9290.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

AUD/USD

*0.9290

0.9420

0.9520

*0.9545

0.9645

Focus Chart of the Day: S&P 500

PT_game_body_Picture_1.png, Price & Time: Was that the Game Changer?Using recent history as a guide (and the benefit of 20/20 hindsight) we should have known yesterday’s Federal Reserve decision would lead to a break higher as virtually every time the index has neared an important price/time point around an FOMC meeting in the “QE era” a positive outcome has been the result. Fed or no Fed the break of the 1710 early August high is significant from a cyclical perspective and removes a major piece of “time resistance” from the bearish equation. The path of least resistance now looks higher in a broader sense, but we don’t believe the advance will be one way. Yesterday’s rally saw the NYSE tick reach 1500 intraday which is a traditional leading indicator of exhaustion (especially after a three week 100 handle advance). A pretty clear medium-term cycle turn window is also in effect over the next couple of days which suggests a pullback should materialize here soon.

--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com

This publication attempts to further explore the concept that mass movements of human psychology, as represented by the financial markets, are subject to the mathematical laws of nature and through the use of various geometric, arithmetic, statistical and cyclical techniques a better understanding of markets and their corresponding movements can be achieved

Looking for a way to pinpoint sentiment extremes in SPX in real time? Try the Speculative Sentiment Index.

To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX

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