€ EURUSD: Topping Pattern Awaits Confirmation

 Strategy: Short at 1.3073 (Avg), Targeting 1.2864
Floating Profit / Loss: -89 pips
We initially sold EURUSD at 1.3121 and added to the position at 1.3026. The pair continues to trace out a choppy Head and Shoulders topping chart formation, with a daily close below neckline support at 1.3025 confirming the setup. The appearance of a bullish Piercing Line candlestick pattern warns an upswing may be ahead however, with initial resistance marked by a falling trend line now at 1.3303. We will remain short for now, maintaining an initial downside objective at 1.2864. A stop-loss will be activated on a daily close above 1.3378.

€ NZD/USD Pattern is Bearish Pre-CPI €

Morning Notes:
DAX – Look lower in the DAX from these levels to new lows as per the operative wave count. The drop will probably feel panicky and be fully retraced.


EURUSD – “Rallies since the March low have unfolded in a corrective manner (3 waves). The suggestion is that the larger trend is down. Focus remains on 12900 and price ideally stays under 13212 although 13379 is the key trend defining level.”


AUDUSD – No change - “From a risk standpoint, 10464 is the bearish line in the sand for me. Exceeding that level would shift focus to former supports at 10509 and 10597.” Last week’s advance failed just before 10464 and at the underside of former trendline support and channel resistance. 10145-10386 is the opening range for the year (first 2 weeks) and a break of the early year range would open up the floodgates towards 9860 and 9660.
NZDUSD – The combination of price pattern since the late February top and key reversal on Friday warrants a bearish stance against 8320. Resistance from December and the 100% extension of the 8471-8061 decline at 7878-7908 define the target area.


USDJPY – Price has rebounded sharply from Monday’s low to reach former support at 8154. Trendline resistance and the 20 day average are additional resistance. The trend for the month has been down and I still want to see a move to new highs in the 10 year (to create divergence) before returning to long USDJPY. 8090-8110 is support.

NZDUSD Triangle Pattern Suggests Bearish Thrust

The current NZDUSD pattern may offer the most information regarding the sell-off in ‘risk’ and how far it is likely to extend, at least over the next week or so. Sideways trade since 3/15 composes a triangle. Triangles are valuable tidbits of information in that their presence typically foreshadows a move in the same direction of the move that preceded the triangle (in this case down) BEFORE a reversal. Thus, look lower towards 7980 (former resistance) and 7880 (former resistance). 8160/90 is resistance.
Bottom Line (next 5 days) – lower