The crosses present a clear picture of risk aversion.  The EURCAD, EURAUD, and EURNZD look constructive while Yen crosses are at risk of slipping lower.  The AUDJPY and NZDJPY are especially vulnerable.

Euro / British Pound

I wrote Wednesday that “today's reversal  just shy of an important 100% extension leaves the pair vulnerable to weakness in a 4th wave back to .9076 or so since the rally may have completed a third wave from .8453 (which is 5 waves itself).”  Short term structure suggests that wave a of the 4th wave is nearing completion.  Expect a corrective rally from near current price.  Resistance is 92.07 and 92.66.      

Euro / Swiss Franc

“There is little to say about the EURCHF technically and there will not be until the pair breaks from the triangle.  The fight between bulls and bears wages on in a triangle that has been underway since October.  Triangles are typically continuation patterns, so a downside break seems more probable.  Still, forecasting is an exercise in probabilities rather than certainties so jump the gun at your own risk.  Pushing through either the top of bottom line triangle line would present a breakout opportunity.”  The triangle count shown above is bearish but a bullish outcome is just as probable.  Wave a would be A and wave B would be a triangle.

Euro / Canadian Dollar

A head and shoulders top has been unfolding since January 2008.  A sizeable bounce (nearly 300 pips) has materialized since the 10/12 low was made just below the neckline.  This brings forth the possibility that the right shoulder is not yet complete.  In fact, the left shoulder was complex with 2 shoulders.  H&S patterns tend towards symmetry which would imply a nearly 900 pip rally from the current level.  This is something to consider as long as 1.5226 remains intact.       

Euro / Australian Dollar

“As mentioned in recent weeks, daily momentum studies are divergent with price lows.  This warns of a low, but until a bullish price pattern emerges, going long is dangerous.”  The EURAUD has continued lower and there is no chart support until 1.6043.  However, today’s candle is forming as a hammer (less than 2 hours left in trading today so the candle will probably end up as a hammer), which is a reversal candle pattern.  Trading through 1.6400 would reinforce the reversal credentials.

Euro / New Zealand Dollar

“There is evidence that the EURUSD may be building a bullish base.  The low that was made on 10/8 has held and price is respecting a short term support line.”  The EURNZD has now exceeded a 7+ month resistance line (and odds are that it will close above the line today as well).  Trading above 2.0280 exposes 2.0450.

Euro / Japanese Yen

Keep in mind the larger pattern, which I have discussed at length in recent weeks – “A B wave triangle is complete at 129 and expectations are for a C wave rally that carries the EURJPY to the mid 140s (at least).  Long term measured objectives are 144.73 and 154.44.  A short term measured level (from short term head and shoulders break) is 134.00.”  The objective was reached and the EURJPY continued straight through to 1.3600.  There is no change to the bigger picture outlook for an eventual thrust through 140.00 but with 5 waves potentially complete from 129.00, the risk of a pullback to at least 133.60 (top of former 4th wave) is high.

British Pound / Japanese Yen

Wednesday’s commentary was that “trading through 144.60 would confirm that wave i is complete and project a move towards the 149.00-150.00 area (and maybe higher).”  The GBPJPY traded has reached the bottom of the Fibonacci zone, which is reinforced by the 9/2 low.  The rally may be wave a of an a-b-c correction.  As such, expect choppy corrective trade lower early next week.

Swiss Franc / Japanese Yen

The CHFJPY is in the same position as the EURJPY.  That is, a bullish triangle is complete at the 10/2 low.  The pair failed at triangle resistance today and a setback should encounter support at 88.50, then 88.00.

Canadian Dollar / Japanese Yen

A new high (above 90.41) is expected eventually since the decline from there is viewed as a complex correction (a-b-c-x-a-b-c).    The advance is unfolding as an impulse (as it should) and a pause in wave 4 may be underway now.  .8600/50 is support and only a drop below .8423 would negate the call for a new high.

Australian Dollar / Japanese Yen

The AUDJPY is trading at its highest level since October 2008.  Daily RSI is above 70 and the rally stalled at a multi month resistance line today.  On an intraday price chart, the rally from 76.30 looks complete in 5 waves.  The risk of a reversal is high.

New Zealand Dollar / Japanese Yen

A clear wave pattern can be seen in the structure of the NZDJPY rally since February.  The advance is an A-B-C correction with wave C as a diagonal.  Reversals following diagonals are usually sharp.  Today’s key reversal (new high close below previous close) may mark a significant top.