Inside the Currency Market: USD/CAD

September 2015 represents the 1 year anniversary since the ECB adopted negative deposit rates which saw EUR/USD drop 3500 pips from 1.3900’s highs to reach 1.0400 lows. The corollary is USD/CAD whose price path began from 1.0600 lows to reach 1.3400 highs, a 2800 pip rise. Despite 1 year later, USD/CAD still suffers the effects of the 1.0600 and 1.0800 breaks as both averages failed to normalize by meeting current prices and are currently way way overbought. Not only is 1.0644 an overbought long term average but equally overbought is 1.0605 and is represented at the 1500 day average. The tops in all averages are found at 1.3245, 1.3443 and 1.3503. Above 1.3503 means price enters new degrees of way overbought but overbought is not only why rallies are sold but volatility is high. USD/CAD is not the pair to hold for longer term gains despite the BOC’s desire to see USD/CAD higher. Short term and intraday, USD/CAD downside is held by significant points at 1.3073, 1.2958, 1.2247 and 1.1705.

So despite overbought, USD/CAD will continue its slow rise. From current 1.3148, USD/CAD is again heading higher to 1.3281 and 1.3321.

USD/CAD. Bottom. 1.3082. Range break above 1.3176, 1.3263, Below 1.3117, 1.3073, 1.3032. Overbought sell point 1.3321, Failure point 1.3281. Strategy. Longs above 1.3149, target 1.3321 then reverse to 1.3235. Points on the way up, 1.3151, 1.3164, 1.3170, 1.3177, 1.3193, 1.3214, 1.3225, 1.3241, 1.3281 and 1.3321.

Shorts below 1.3146, target 1.3114. Watch here for reversal to 1.3146 and higher. Points on the way down, 1.3137, 1.3129, 1.3123, 1.3116, 1.3082 Bottom. Point 1.3114 must cross to go higher.

Brian Twomey, Inside the Currency Market, btwomey.com

Inside the Currency Market: 14 USD Pairs

Below are 14 USD pairs, highlighted by overbought / oversold determinations and major support and resistance points. Levels are actionable and trade able points. The commonality for the most part across all 14 pairs is USD is overbought. In G 10, USD/CAD remains past and present way overbought, USD/JPY is approaching overbought while USD/CHF fails in overbought / Oversold determinations because its trapped by major supports below and major resistance points above. The USD/CHF phenomenon is seen in an overbought NOK but oversold SEK. Trends are found in INR and KRW provided supports hold as both pairs are way oversold. THB and SGD earn the way overbought distinction while TRY, IDR and RUB as well remain severely overbought. HUF is holding its own but nothing special exist in overbought / oversold revelations. USD/CAD will be posted here this afternoon in more detail.

What holds USD in overbought is the promise by Big Sis Yellen to raise Fed Funds. Failure to do so will see USD drop like a rock. The disastrous Non Farm Payrolls report Friday only adds to further uncertainty. Accompanied by further uncertainty could very well see an uncertain USD price, wandering and meandering in ranges until a firm message or actual hike is delivered.

USD/JPY. 119.86 close. Above 120.86 and 122.36.

USD/CAD. 1.3148 close. 1.3073 and 1.2959. Way overbought.

USD/CHF. 0.9705 close. 1.0372 above vs 0.9466, 0.9592, 0.9660.

USD/NOK. 8.3821 close. 6.4451, 8.1572, 8.2447. Way way overbought.

USD/SEK. 8.3544 close. 8.4357, 8.4184, 7.6967, 6.9873.

USD/INR. 65.20 close. 65.17, 64.79, 54.15, 53.54.

USD/KRW. 1173.09 close. 1166.79, 1160.91, 1125.99, 1112.43, 1112.39. Oversold.

USD/IDR. 14,722.50 close. 14,122.32, 13.794.50, 10,312.08 Way overbought.

usd/SGD. 1.4328 Close. 1.4798, 1.5208, 1.4016, 1.3842, 1.2929. Overbought.

USD/THB. 36.42 close. 35.40, 35.03, 33.34, 31.68 Overbought.

USD/RUB. 66.05 close. 63.55, 61.88, 35.62 Severely overbought.

USD/HUF. 279.23 close. 280.28, 279.33, 228.34, 224.37, 224.35.

USD/TRY. 2.98 close. 2.9091, 2.8338, 1.9894, 1.9119.

More trades, info posted here over the weekend and we continue as usual. Prices flew before I was able to post, same as last month.

Brian Twomey, Inside the Currency Market, btwomey.com