Bullish Objectives Clearly Defined for Yen Trades

DailyFX   |  February 7 2012 3:45 EST

Continue to look higher in the Yen crosses over the next few weeks towards the tops of respective channels and Fibonacci extensions.

Euro / Japanese Yen

Daily Bars

Prepared by Jamie Saettele, CMT

I wrote last week that “the EURJPY (and Yen crosses) have NOT accelerated lower and one must consider the possibility that important lows have formed. The low on the first of the month occurred right where one would expect in a larger bullish structure (former 4th wave area…near its low). As such, I am favoring a bullish bias as long as price is above 9924 (21 low). Upside levels of interest in the coming weeks are 10440 (100% extension) and 10570 (December high).” Continue to look higher towards the mentioned levels as well as channel resistance, which is at 10390 on Wednesday (at 10440 on the 13th). Risk on longs can be moved up to 9985 and 10135/50 is near term support.

Bottom line: long, stop 9985, targets 10440, 10570

British Pound / Japanese Yen

Daily Bars

Prepared by Jamie Saettele, CMT

Longs remain favored towards the confluence of the 100% extension of the 1/13-1/25 rally and 200 day average at 12435/55. Channel resistance intersects this level on 2/13. Near term support comes in at 12190 and risk on longs can be moved to 12045 (from 11955).

Bottom line: long, stop 12045, target 12400-12500

Australian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele, CMT

The AUDJPY has taken out its January high and 9 month trendline, which exposes the October high (and intervention high) at 8395. It is possible that the rally from the 12/15 low is a completed 5 wave advance so stops on longs should be kept to Monday’s low (8185). Support is 8260 and 8230. An extended objective is the 100% extension of the rally from the October low, at 8668.

Bottom line: long, stop 8185, target 8600

Canadian Dollar / Japanese Yen

Daily Bars

Prepared by Jamie Saettele, CMT

The CADJPY has broken higher and bulls are in control as long as price is above 7576. Objectives going forward are channel resistance, the October high at 7964 and a Fibonacci confluence at 8080/8100 (100% extension of rally from October low and 161.8% extension of rally from November low).

Bottom line: long, stop 7575, target 8080

Euro / Australian Dollar

Daily Bars

Prepared by Jamie Saettele, CMT

Today’s outside day reversal indicates that the EURAUD decline from the November high may be complete (an objective was just below 12000 but it would be foolish to ignore this reversal evidence) in 5 waves. The implications are for a rally (but probably in a corrective 4th wave) from the current level.

Bottom line: long, stop 12130, target open

Euro / British Pound

Daily Bars

Prepared by Jamie Saettele, CMT

It remains possible that “the EURGBP rally is a corrective 4th wave advance and that a new low will be registered (under 8221)” but today’s move through the early month high decreases confidence in a bearish bias. However, risk on shorts should be kept to 8410 (1/27 high) as a move above probably triggers a move to at least 8485. Levels of interest on the downside are the August and July 2010 lows at 8141 and 8066. Fibonacci extensions come in at 8103 and 8033.

Bottom line: flat

Euro / Canadian Dollar

DailyBars

Prepared by Jamie Saettele, CMT

The decline from the 1/27 high is clearly corrective and today’s advance shows impulsive characteristics. As such, a more important low may be in place at the 1/17 low than previously thought. Exceeding 13251 would shift focus to the 100% extension at 13374. Channel resistance intersects this level next week.

Bottom line: flat

--- Written by Jamie Saettele, CMT, Senior Technical Strategist for DailyFX.com

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Jamie is the author of Sentiment in the Forex Market.