Forex: Euro weakens but Aussie, Yen resilient

The Euro followed through below $1.3150, after breaking support at $1.32, confirming a correction to primary support at $1.2750/1.2800. Reversal of 63-day Twiggs Momentum below zero would strengthen the signal.

Euro/USD

Sterling penetrated the descending trendline (weekly chart) against the euro, suggesting the primary down-trend is over. Breakout above €1.19 would complete a double bottom with a target of €1.24*. Recovery of 13-week Twiggs Momentum above zero also indicates a primary up-trend. Reversal below €1.16 is unlikely, but would warn the down-trend may continue; failure of primary support at €1.14 would confirm.

Sterling/Euro

* Target calculation: 1.19 + ( 1.19 – 1.14 ) = 1.24

The greenback broke out of its triangular pattern (weekly chart) against the Yen, but too close to the apex to have much significance. Follow-through above ¥101.50 would offer a long-term target of ¥114*. Reversal below ¥96 is unlikely, but would test primary support at ¥94.

USD/JPY

* Target calculation: 104 + ( 104 – 94 ) = 114

Canada’s Loonie is testing primary support at $0.9450 against the greenback. Respect, indicated by recovery above $0.96, would test the descending trendline (weekly chart) and resistance at $0.9750. Failure of support is as likely, however, and would warn of another decline.

Canadian Loonie

The Aussie Dollar penetrated its descending trendline (daily chart) against the greenback, suggesting the primary down-trend is weakening. Breakout above $0.92 would complete a double-bottom reversal with an initial target of $0.95*. Respect of resistance remains likely, however, and would signal another test of primary support at $0.89*.

Aussie Dollar

* Target calculations: 0.92 + ( 0.92 – 0.89 ) = 0.95; 0.89 – ( 0.92 – 0.89 ) = 0.86

The Aussie penetrated its descending trendline (weekly chart) against the Kiwi, suggesting that the primary down-trend is over. Breakout above $1.16 would confirm, while reversal below $1.12 would signal another decline.

Canadian Loonie