By Charles Lanman
Short 4.2160 and 4.2426 to target 4.0963. Short below 4.0831 to target 4.0166.
USD/PLN for the week is currently oversold and sits on solid supports at 3.8828 and 3.8426. Overall, USD/PLN is heading much lower.
Long 4.3857 and 4.3738 to target 4.3977. Long above 4.4096 to target 4.4454. Short 4.4454 to target 4.4215.
USD/JPY from its 106.87 close resides just above solid and multi year supports at 106.53 and 106.04. A break of 106.04 then long term targets at the multi year range lows becomes 102.00’s. USD/JPY higher however contains many break point hurdles beginning at 107.89 then 108.26, 108.99, 109.19 and 109.67.
Overall ranges are contained from 106.04 to 109.19 and 109.67. USD/JPY at 106.87 trades at its extremes from its price driver at 109.19. At extremes informs 106.04 lacks any chance to break anytime soon. The lower USD/JPY trades only enhances its extremes and offers to not only trade higher but skyrocket higher.
Seen from USD/JPY currently is about a 100 to 150 pip range yet overall ranges are compressing by the week.
USD/JPY at 109.19 and 109.67 is matched by EUR/USD inability to move higher unless 1.1196 breaks. EUR/USD’s 1.1196 overhead has been dropping by the week over many, many months. The week of Januray 4 for example, current 1.1196 was 1.1280. Due to the slow weekly drops to overall price drivers, both USD/JPY and EUR/USD currently engage in a simultaneous race to the bottom. This situation cannot hold in perpetuity as the logjam must eventually break and I would look to EUR/USD higher as EUR/USD not only has ability to move upward but ranges allow for a move higher.
USD/JPY 106.87 close is an interesting number as CHF/JPY main break point for lower is located at 106.87. CHF/JPY retains the same predicament as USD/JPY to weekly range compression. USD/JPY at least contains a 100 -150 pip latitude to its ranges while CHF/JPY is surrounded by many and massive break points.
Lower and multi year supports for CHF/JPY are located ay 109.23, 110.65 then 106.87 and 106.09. To move higher and target 112.00’s, CHF/JPY must break 111.45, 111.53, 111.88 and 111.93. For CHF/JPY at 112.00’s now reaches the apex to its 20 year range tops. CHF/JPY lacks ability to trade above 112.00’s.
EUR/CAD at 1.5400’s is massively overbought. Long term target for EUR/CAD is 1.4882 however current solid supports reside at 1.4968 and 1.4954. Typical AUD/CAD trades within a 300 pip range from 0.9228 to 0.8913. At 0.9200’s represent extremes and not expected to break anytime soon while a break of 0.8913 informs not only lower but AUD/USD much lower.
EUR/CAD offers a good trade while AUD/CAD offers about a 100 pip trade. CHF/JPY will struggle while USD/JPY offers a decent weekly trade. Attraction to EUR/CAD for this week is USD/CAD and CAD/JPY ranges again are extremely wide. More importantly CAD/JPY ranges finally match USD/CAD. Over many months, CAD/JPY was contained Vs USD/CAD. Explains CAD/JPY lackluster performance over many months. This week, both will trade as equals.
Long 106.71 and 106.55 to target 107.72. Long above 107.89 to target 108.55.
Short 111.66 and 111.98 to target 111.17. Short below 111.01 to target 110.35.
Short 1.5495 and 1.5504 to target 1.5173. Short 1.5115 to target 1.5028.
Short 0.9072 and 0.9098 to target 0.8966. Short below 0.8913 to target 0.8855.