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Talking Points

  • EUR/USD testing key long-term pivot area
  • USD/CAD cycle turn window later this week
  • USD/JPY rebounds from range lows

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Foreign Exchange Price & Time at a Glance:

Price & Time Analysis: USD/JPY

Price & Time: Key Test for the Euro

Charts Created using Marketscope – Prepared by Kristian Kerr

  • USD/JPY is in recovery mode after finding support near the low end of its six month range
  • Our near-term trend bias is higher in the rate while above 101.05
  • The 102.25 area remains a key upside pivot with traction above needed to usher in a more significant advance
  • A cycle turn window is eyed here
  • A move back under 101.05 would re-shift focus lower

USD/JPY Strategy: Like going long on a move through 102.25.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/JPY

*101.05

101.35

101.50

101.75

*102.25

Price & Time Analysis: USD/CAD

Price & Time: Key Test for the Euro

Charts Created using Marketscope – Prepared by Kristian Kerr

  • USD/CAD is in consolidation mode near the 38% retracement of the June/July decline in the 1.0750 area
  • Our near-term trend bias is higher in Funds while over 1.0630
  • Strength through 1.0800 is needed to signal the start of a new leg higher in the rate
  • The end of the this week/early next week looks to be the next key cycle turn period for USD/CAD
  • A move under 1.0630 will turn us negative on the exchange rate

USD/CAD Strategy: Like the long side while above 1.0630.

Instrument

Support 2

Support 1

Spot

Resistance 1

Resistance 2

USD/CAD

*1.0630

1.0710

1.0745

1.0750

*1.0800

Focus Chart of the Day: EUR/USD

Price & Time: Key Test for the Euro

We highlighted the chart above last week. It is a monthly chart of EUR/USD with key Fibonacci retracement and extension levels drawn off yearly highs and lows since 2008. This morning the exchange rate is testing the low end of a confluence zone. If the rate can manage a close sub 1.3460 this week we think it will be strong evidence that the euro is finally embarking on a more significant decline. More importantly this should set the stage for a generally weak second half of the year. In the longer-term scheme of things 1.3730 needs to be reclaimed to neutralize the negative picture.

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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.

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