The drop from 1.0823 is either a completed A-B-C decline, is wave A of a triangle, or wave C is still underway from near 1.0140. 2 of those counts call for a push through 1.0140 eventually but even so, weakness is expected near term in order to correct the advance from .8881. Look for support in the .9343-.9483 zone (50%-61.8% of .8886-1.0081).
Focusing on the big picture, the decline from 1.0546 (2004 top) is in 3 waves. 3 waves indicate a correction, which should be fully retraced. Therefore, the long term bullish target for the AUDCAD is not until 1.0546. Near term, trendline support is at .9536. A drop below there would likely lead to a test of the 5/14 low at .9293.
Longer term, the pair is headed for a test and likely a break of the 2000 high of 1.3506. A consolidation/pullback should get underway soon as a 4th wave. We’ll reiterate what we’ve mentioned in recent weeks though; shorting is dangerous because there is the possibility that the advance extends from current levels given that the larger degree trend is up.
Tell us what you think about this report: contact the strategist about the article at jsaettele@dailyfx.com
TREND ANALYSIS is based on a rolling pivot model. LONG TERM TREND is determined by the last 3 months of price data (high, low, close). SHORT TERM TREND is determined by the last 4 weeks of price data (high, low, close). R3, R2, R1, PL, PH, S1, S2, and S3 are provided to aid in identifying entries and exits. These are objective measures and our subjective analysis (STRATEGY) may differ.
SCHEDULE
Monday: EURGBP, EURCHF, EURCAD, EURAUD, EURNZD
Tuesday: EURJPY, GBPJPY, CHFJPY, CADJPY, AUDJPY, NZDJPY
Wednesday: GBPCHF, GBPCAD, GBPAUD, GBPNZD
Thursday: AUDCHF, AUDCAD, AUDNZD