FX Weekly: DXY and 14 Currency Pair Levels and Targets

DXY traded to 101.99 lows last week. As written every week since the DXY top at 114.00’s in September, DXY not only contains miles of downside but above averages were built into DXY’s price every 100 ish pips to prevent USD and DXY rises. This week is no different as above averages begin at 102.95, 103.29 and 103.80 and travel every 100 pips to 109.00’s.


From DXY’s close at 102.18, next vital points are located 77 pips to 102.95 and 111 pips to 103.29. DXY is on its way to challenge the 50 year average at 96.00’s and 5 year at 95.00 or 500 more downside pips.


Time Vs Distance and Targets


The question to when DXY challenges 96.00’s is a time factor as Time = distance divide by speed. An example was previously calculated for USD/JPY on January 10th at USD/JPY 131.75 and target at 128.81 or 294 pips.


Time = Distance divide speed or Distance = speed X time.
Total 294 pips from 131.75 or 50 pips per day = 6 days,


At 25 pips per day = 12 days,
At 10 pips per day = 30 days


USD/JPY traded 294 pips to 128.81 target in 3 days.


DXY at 50, 25 and 10 pips per day offers 10 days, 20 days and 50 days. The time factor is a basic synopsis to length of time to hold trades to target.


Charts Vs Trades and Targets


As always, past and future trades requires pen, paper and calculator rather than charts, indicators and fibs as charts and indicator tools severely limits profits by late to entries and short sighted targets.


The Week


From DXY downside and limited ability to travel higher, EUR/USD, GBP/USD, NZD and AUD remain married to long only strategies.


EUR/USD


EUR/USD trades a 380 pip range from 1.0486 to 1.0866. A break above 1.0866 targets the range from 1.0866 to 1.1116 and target at 1.0001. EUR/USD from 1.0486 trades deeply overbought and sustained price above 1.0866 begins a new trend higher. The big lines for the week above 1.0866 is located at 1.0917 and 1.0969. Lower targets for the week is found at low 1.0700;s.


USD/JPY trades a current range from 125.36 to 135.12. A break at 125.36 targets 122.00’s and the short term range from 125.36 to 119.34. USD/JPY’s larger range is located from 112.00’s to 135.00’s. USD/JPY trades massive oversold from 135.00’s and overbought from 112.00;s.


JPY Cross Pairs


Overall JPY trade strategy is short only. The problem to JPY cross pairs is leader GBP/JPY as a vital break exists this week at 156.13. Below targets the range from 156.13 to 153.50 then 152.80. Above 156.13 targets the larger range from 161.85 to 156.13.


GBP/JPY corresponds to not oversold or overbought but as a currency pair without direction or purpose. EUR/JPY serves as JPY cross pair leader to replace GBP/JPY due to EUR/JPY’s price to emerge as the exact same to USD/JPY. GBP/JPY becomes the currency to follow EUR/JPY and USD/JPY.
GBP/JPY overall goes short this week from 157.00’s to high 158.00’s.


CAD/JPY trades from 95.29 to 100.63. Below 95.29 targets the range from 95.29 to 91.34 then 90.18 and targets 94.29.


EUR/JPY trades from 141.02 and 141.54 to 135.26. Below 135.26 targets the range from 135.26 to 131.82 and the target at 134.38. EUR/JPY’s larger range trades 129.84 to 141.02 and 141.54. Similar to USD/JPY, 141.00’s trades massive oversold to deeply overbought at 129.00’s.


For the week, we’re short as EUR/JPY is the preferred trade among JPY cross pairs.


AUD/USD trades 0.6784, 0.6967 and 0.7129. The larger range is established from 0.7600’s to 0.6784. From 0.7600’s is oversold from 0.6900’s while 0.6784 is overbought.


GBP/USD no difference from past weeks as the range is located from 1.1988 to 1.2539. GBP/USD at 1.2200’s is dead center at 1.1988 and 1.2531 on a range trade strategy for longs at 1.2100’s and shorts at 1.2300’s.


EUR/NZD’s range is found from 1.6905 to 1.7257 or 1.6905 to 1.6832 and 1.6802. EUR/NZD is clearly the better trade to GBP/NZD..


GBP/AUD Trade


GBP/AUD’s big break for higher prices is found at 1.7675 and current oversold below 1.7540. The strategy is long all week from any price at 1.7400’s to target middle to upper 1.7500’s. Continue the strategy all week.


EUR/AUD break for lower at 1.5459 targets 1.5300’s on a short only strategy.


EUR/CAD Vs GBP/CAD


Lower for EUR/CAD must break 1.4496, 1.4488 and 1.4477 to target the range from 1.4257 to 1.4477. EUR/CAD’s 10 and 5 year average at 1.4585 and 1.4788 is just ahead of the current price at 1.4502 .
GBP/CAD ranges from 1.6448 to 1.6787 or 1.6448 to 1.6101. Nothing special to GBP/CAD except a long only strategy to target 1.6567 and the break at 1.6448.


USD/CAD next break lower is located at 1.3142 to target 1.3117. Any price at 1.3400’s is open to shorts to first target at 1.3283 then 1.3240.


NZD/USD from the close at 0.6380 trades overbought inside the range from 0.6242 to 0.6458. Above 0.6458 targets 0.6574 and the new range at 0.6458 to 0.6629.

Brian Twomey

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