Last week’s currency markets reported the 2nd week to Statistical nightmares, Statistical anomalies where Majors in USD V Non USD are at Statistical Wars with respect to their own prices as well as war against other currency pairs.
Traditionally, if one currency pair is affected by uncertain statistical direction then all currency pair prices are affected as nations purposefully hold currency prices extremely close to its counterpart nations, especially in today’s central bank newly created currency price.
Statistical assessment over the past 2 weeks revealed itself as technical analysis displays this week Doli candles in GBP/USD, AUD/USD, GBP/CAD, GBP/AUD, EUR/CAD, EUR/AUD.
Recall last week’s revelations to not only above cross pairs on the problem list but best price movements would derive from cross pairs. Why is answered by settlement in EUR/USD, USD/CHF, USD/CAD, USD/JPY and NZD/USD but unsettled prices to GBP/USD and AUD/USD. The further note is JPY cross pairs remain in good stead to problems except EUR/JPY.
While EUR/USD is desperately trying to rise, range tops in EUR/JPY, EUR/GBP, EUR/CAD, EUR/AUD and problem pair EUR/CHF prevent EUR/USD further to break its vital point at 1.1819.
While GBP/USD price is far to low and must rise, problems derive from GBP/CAD, GBP/AUD and GBP/NZD.
As AUD/USD also desperately seeks to rise to break 0.7520, problems developed in AUD/CAD and AUD/NZD while AUD/CHF leaves the problem pair list.
Overall, currency prices contain range and alignment dilemmas and the origin is located from exorbitantly high interest rates in all nations.
The RBA and Lowe confirms wholesale interest rates are far to high. Such a development derives from the Fed as all central banks price national interest rates from the Fed and it begins with the RBNZ then feeds to all central banks. To high by my assessment and common to all central banks is about 40ish basis points and quite staggering by today’s standards.
EUR/USD targets this week 1.1798 on breaks of 1.1700, 1.1715 and 1.1729. Vital break at 1.1819 targets higher levels at 1.1916, 1.1972 and eventual 1.2088. Below targets 1.1545, 1.1410 and 1.1401 on breaks of 1.1680 and 1.1631. EUR/USD strategy remains longer term in long only mode as averages are rising alongside higher prices.
USD/JPY current massive overbought and multi year range top at 112.82 targets lower to 111.11, 109.64 and 109.42. Target at 109.00’s achieves destinations only on a break of 110.27. The 110.00’s and 109.00’s however formed many and massive supports from 110.73, 110.54, 110.40 and 110.32.
USD/JPY gained roughly 200 pips per month since the 104.63 bottoms in March and now the 112.82 range top is upon JPY. Short only is the strategy over the longer term as USD/JPY contains every ability to travel lower to 108.00’s and 107.00’s.
GBP/USD ranged last week 252 pips from 1.3360 to 1.3108 lows and its vital break point for higher to 1.3500’s, 1.3600’s and 1.3800’s is located at 1.3412. GBP/USD targets this week 1.3313 and a must break point in order to challenge 1.3412. Any price below 1.3220 is open to longs on a long only strategy as GBP targets far higher prices over time.
AUD/USD break point is located at 0.7520 and targets upon a break higher 0.7566, 0.7634 and 0.7773 longer term. AUD/USD’s previous multi week target at 0.7500’s was prevented by a corrective rise in EUR/AUD to 1.5900’s from the 1.5200 lows in June. Current EUR/AUD target at 1.5500’s and lower places AUD/USD to its current 0.7520 break point.
USD/CAD again remains most favored because its a pure and market oriented currency pair. Neither the BOC nor Fed holds USD/CAD from its wide movements.
A break at 1.3106 and 1.3039 allows CAD a run to its vital point for lower at 1.3014 to target 1.2972, 1.2956, 1.2905 and 1.2858. USD/CAD trades at multi year range tops and the commitment to a lower CAD on a short only strategy not only remains but holds for many weeks to come.
Problem pair break points .
EUR/CHF is not only overbought but watch the break point at 1.1652.
GBP/CAD Do or Die is located at 1.7450.
GBP/NZD current overbought and break point is located at 1.9359.
GBP/AUD Do or Die at 1.7835 from the close at 1.7829.
AUD/CAD Watch 0.9784 from the close at 0.9765.
AUD/NZD severely overbought from its 1.0970 close requires a break at 1.0855 for much lower prices.
CAD/CHF from 0.7611 closed exactly on its 100 day average and its break point is located at 0.7578 to target lower prices.