Tag: Japanese yen

The Euro broke out above its trend channel and resistance at $1.2750 on the daily chart to signal a primary up-trend. Recovery of 63-day Twiggs Momentum above zero confirms. Target for the advance is the 2012 high of $1.35*.

* Target calculation: 1.275 + ( 1.275 – 1.20 ) = 1.35

Pound Sterling is correcting to support around €1.22 against the Euro. Breach of the rising trendline would warn that a top is forming, while retreat of 63-day Twiggs Momentum below zero would indicate a primary down-trend.

Canada’s Loonie is retracing to test the new support level after breaking above resistance against the greenback at $1.02.  Breakout confirms the primary up-trend indicated by long-term bullish divergence on 63-day Twiggs Momentum. Target for the advance is $1.08*.

* Target calculation: 1.02 +( 1.02 – 0.96 ) = 1.08

The Aussie Dollar is testing resistance at $1.06 against the greenback. The 63-day Twiggs Momentum trough above zero signals a primary up-trend. Breakout above $1.06 would confirm.  Expect resistance at $1.075/$1.08, but target for an advance would be $1.10*.

* Target calculation: 1.06 + ( 1.06 – 1.02 ) = 1.10

I commented a few days ago that apart from a bad case of Dutch Disease —  where capital inflows and increased revenues from resources projects drive up the exchange rate and harm other export industries — the Australian dollar is at risk of developing “Swiss Disease” — where flight to a safe haven currency also drives up the  exchange rate, destroying local export industries. Professor Warwick McKibbin has a point:

“When a portfolio shift into Australian currency is observed, the exchange rate change should be completely offset so the shock only affects the money markets rather than the real economy. If the shock cannot be observed precisely then the central bank should “lean against the wind”, that is intervene to slow down the extent of appreciation of the exchange rate.”

The RBA should be selling dollars to protect local export industries from rapid appreciation of the currency.

The Aussie Dollar is headed for resistance at ¥83.50 against the Japanese Yen. Recovery of 63-Day Twiggs Momentum above zero indicates a primary up-trend. Breakout would signal an advance to ¥88*.

* Target calculation: 84 + ( 84 – 80 ) = 88

The Euro is headed for $1.275, unaffected so far by the announcement that the ECB will purchase government bonds in the secondary market. Expect strong resistance at $1.275, reversal below the lower trend channel would warn of a correction.

Pound Sterling is weakening against the euro, with a descending triangle testing support at €1.255. Failure of support would indicate a test of €1.230. 63-Day Twiggs Momentum is falling, but continues to indicate a primary up-trend.

* Target calculation: 1.255 – ( 1.285 – 1.255 ) = 1.225

Canada’s Loonie is testing resistance against the greenback at $1.02.  Breakout would indicate an advance to the 2011 highs at $1.06. Reversal below parity is unlikely, but would test primary support at $0.95/$0.96. Rising 63-day Twiggs Momentum suggests a primary up-trend.

The Aussie Dollar found support at $1.02 against the greenback. Expect a test of $1.04. Breakout would indicate $1.06, while respect would warn of a down-swing to parity. Recovery of 63-day Twiggs Momentum above zero suggests an up-trend.

The Australian Dollar found support against the yen at ¥79.50/¥80.00. Recovery above ¥83.50 would indicate a test of ¥88.00. Rising 63-day Twiggs Momentum suggests a primary up-trend. Reversal below ¥79.50 is unlikely, but would indicate another test of primary support at ¥74.

A monthly chart shows the euro testing long-term support at $1.20 against the greenback. Recovery above the steeply descending trendline would indicate another test of the upper triangle border, while failure of support would indicate long-term re-alignment. Indications, from president Mario Draghi, that the ECB will further expand its balance sheet explains euro weakness, but similar moves by the Fed would restore the status quo.

On the daily chart, the Euro is headed for resistance at $1.275. The primary trend remains downward, but breach of the descending trendline indicates it is losing momentum. Failure of support at $1.240 and penetration of the rising trendline, however, would indicate another test of primary support at $1.205.

Pound Sterling formed a descending triangle, testing support at €1.255 against the Euro. Failure of support would indicate a test of €1.225. 63-Day Twiggs Momentum is falling, but continues to indicate a primary up-trend.

* Target calculation: 1.255 – ( 1.285 – 1.255 ) = 1.225

Canada’s Loonie is consolidating in a narrow band below resistance against the greenback at $1.02.  Breakout above resistance at $1.02 would indicate an advance to $1.06, while reversal below parity would test $0.95/$0.96.

The Aussie Dollar is retracing to find support against the greenback, with $1.02 a likely target. Respect would suggest another test of $1.08. Narrow oscillation of 63-day Twiggs Momentum around zero would suggest a ranging market.

Australian Dollar appreciation against the yen is slowing. Reversal below ¥79.50 would indicate another test of primary support at ¥74.

The Euro is testing short-term support at $1.2250 on the daily chart. Recovery above $1.2400 would indicate another rally, while failure of support would test primary support at $1.2050. The primary trend is still downwards, but breach of the descending trendline means the primary down-trend is losing momentum and a bottom is forming. Failure of primary support is unlikely but would warn of another down-swing, with a target of $1.185.

* Target calculation: 1.215 – ( 1.245 – 1.215 ) = 1.185

Pound Sterling found support at €1.255 against the Euro before rallying to €1.28. Narrow consolidation between €1.27 and €1.28 suggests continuation of the rally. Breach of resistance at €1.29 would signal an advance to €1.315*. Rising 63-day Twiggs Momentum reflects a strong primary up-trend.

* Target calculation: 1.285 + ( 1.285 – 1.255 ) = 1.315

Canada’s Loonie is headed for a test of resistance against the greenback at $1.02.  Bullish divergence on 63-day Twiggs Momentum on the weekly chart suggests a primary up-trend; confirmed if resistance at $1.02 is broken.

Shallow retracement of the Aussie Dollar against the greenback suggests trend strength. Recovery above $1.06 would indicate an advance to $1.075. Breakout above $1.075/$1.08 would offer a long-term target of $1.20* but RBA intervention, to protect local industry, could be a factor.

* Target calculation: 1.045 + ( 1.045 – 1.015 ) = 1.075

The greenback found support at ¥78 against the Japanese Yen. Rising Twiggs Momentum and penetration of the descending trendline both warn that a bottom is forming. Recovery above ¥80.50 would complete a double bottom reversal, suggesting an advance to ¥84.

* Target calculation: 81 + ( 81 – 78 ) = 84

The Aussie Dollar broke medium-term resistance at ¥82 against the Japanese Yen, headed for a test of the upper range border at ¥88/¥90. Rising 63-Day Twiggs Momentum and recovery above zero suggest a primary up-trend as the Aussie Dollar attracts capital inflows.