Chart Of The Day

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; Fibonacci retracements in grey; 50-period simple moving average in light blue.)

7/16/2009 – USD/CAD – After plummeting for three straight trading days, bearish price action on USD/CAD, a daily chart of which is shown, appears to be taking somewhat of a breather as of Thursday (7/16/2009). The current fall was initiated after price retraced up to around a key 38.2% Fibonacci retracement level (the high-to-low retracement span being measured from the the fourth test of the 1.3000 high in March to the 1.0800 lows hit in early June). Currently, bullish corrections notwithstanding, the pair appears to be targeting the 1.0800 lows once again, after breaking down significantly below the prior support in the 1.1450 region. Any breakdown below 1.0800 would confirm a major downtrend continuation, with several further support targets to the downside, including 1.0550 and 1.0300. Upside resistance within the current bearishness resides in the noted 1.1450 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/15/2009 – USD/JPY – Bullish price action in the last few trading days on USD/JPY, a daily chart of which is shown, rebounded off the bottom border of a parallel downtrend channel, and has just reached major resistance in the 94.00 price region as of Wednesday (7/15/2009). This is a key support/resistance level, as it has served alternately as strong resistance and strong support since the beginning of the year. Any clean breakout above this level should carry the bullish momentum to target further significant resistance around the 96.00 price region, and then the top of the parallel downtrend channel. Downside support in the event that 94.00 is respected continues to reside at or around the bottom of the channel, as well as the key 91.00 support/resistance region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)

7/14/2009 – EUR/JPY – Price action on EUR/JPY, a daily chart of which is shown, has consolidated, much like other yen crosses, in what is appearing to be an inverted pennant formation. This potential pennant, however, would only be confirmed as a continuation pattern if there is a significant breakdown to the downside of the pattern. In this event, a strong pattern breakdown could signify a definitive downtrend for the pair, especially if price goes on to reach the next major downside support target in the 126.00 price region. Current major resistance resides immediately to the upside in the 131.00 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/13/2009 – AUD/USD – Recent bearish price action on AUD/USD, a daily chart of which is shown, has once again brought the pair down to a critical support/resistance level in the 0.7700 price region, an area that has served in the past couple of months both as a substantial resistance turning point as well as a substantial support turning point. This drop down to major support occurs after price formed a tentative top by breaking down successively below two significant uptrend support lines. In the event of a pronounced bounce up off this 0.7700 level, the clear ultimate resistance target to the upside resides around the important uptrend high, in the 0.8260 price region. Any breakout above that level would confirm an uptrend continuation. In the event of an impending breakdown below the 0.7700 support, a further strong support target to the downside resides in the 0.7450 price region, which represents a significant prior swing low in the uptrend.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/10/2009 – EUR/USD – Price action on EUR/USD, a daily chart of which is shown, once again retraced back up to re-test a key uptrend line on Thursday after having broken down below the same trendline in the beginning of the week. This bullish pullback, however, was in the process of being reversed as of Friday morning, as the EUR/USD bears came back into play to push for a bearish continuation of the trendline breakdown. This potential bearish continuation, however, would only be confirmed on a significant drop below the 1.3830 breakdown low. If this occurs, immediate further support to the downside resides in the key 1.3750 price region. And any subsequent break below that important level would be a substantially bearish indication for the pair that would place the current general uptrend in clear jeopardy of being reversed. To the upside, the apparent price level to watch for continues to be the 1.4335 level, which represents the highest high in the current uptrend. In the event of any near-future breakout above that level, an uptrend continuation will have been confirmed.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/09/2009 – USD/JPY – Yen strengthening this week has manifested itself in a dramatic fashion on USD/JPY, a daily chart of which is shown. Needless to say, the 300+ pip plummet in the pair yesterday, not to mention the even more drastic drops in the yen crosses, highlighted the sheer magnitude of the yen’s very recent dominance. The drop on USD/JPY reached a low below 92.00 before relenting and retracing. That low point represents the lower border of a parallel downtrend channel that price has been traversing since the early April high. Therefore, yesterday’s move reached a significant target low for short traders. But the bearishness in this pair is likely not over yet. A key further support target to the downside resides in the important 91.00 region. Any substantial breakdown below that level could ultimately target the key 87.00 level. Tentative upside resistance in the context of the current downtrend resides in the 94.00 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)

7/08/2009 – GBP/USD – Price action on GBP/USD, a daily chart of which is shown, has continued its substantial bearish bias since the pair broke down below a key uptrend support line extending from a late April low. Currently the bearishness is showing little sign of abating, and clear support targets to the downside include another uptrend support line, this one extending from the March low, as well as the 1.5800 horizontal support level. At the current time, these two support factors are approximately coinciding. To the upside, key short-term resistance in the context of the current bearishness resides around 1.6200, the previous short-term support level.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)

7/07/2009 – NZD/USD – Price action on NZD/USD, a daily chart of which is shown, has made a bullish pullback correction after breaking down below a key uptrend support line extending from the March lows. Any breakdown below 0.6240, which was the low point before the pullback, would confirm a continuation of the trendline breakdown, and should easily target strong further support in the key 0.6100 support/resistance region. And any subsequent breakdown below that 0.6100 level could indicate a major reversal in the current overall uptrend. For the time being, however, this currency pair continues to travel in a sideways consolidation, much like other dollar-based pairs. To the upside, the key level to watch would be the 0.6600 price region, a breakout above which would signify a clear uptrend continuation.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/06/2009 – EUR/USD – Price action on EUR/USD, a daily chart of which is shown, has tentatively broken down below an uptrend support line extending from the late April lows. This breakdown is significant, but does not yet place the pair in immediate jeopardy of breaking its overall uptrend. This would occur only on a strong breakdown below the 1.3750 price region. Currently, the short-term bearishness in the pair is apparent, but price is still entrenched within a prolonged sideways consolidation, despite the trendline breakdown. Further bearish follow-through on this trendline break should target key support in the noted 1.3750 support/resistance region. To the upside, the 1.4335 resistance is still the key price level to watch, as a significant breakout above that level would confirm a clear uptrend continuation.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; Fibonacci retracements in grey; 50-period simple moving average in light blue.)

7/02/2009 – AUD/USD – Dollar-strengthening price action on AUD/USD, a daily chart of which is shown, has once again descended back down to a key uptrend support line extending from the March lows. This line has already been touched three times since its inception, and the current bearishness has created a fourth. While this currency pair can certainly be considered to be in an overall uptrend situation, the last several weeks have been marked by a prolonged sideways consolidation, much like the price action on other key currency pairs. Currently, as of this writing, price is right above the noted uptrend support line. Any significant breakdown of this line should target further strong support in the 0.7700 price region. In the event that price respects the current trendline with a bounce, an uptrend continuation would be confirmed only on a breakout above the 0.8263 uptrend high, which could then target further resistance in the 0.8500 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1