Forex4you Technical Analysis 17 May 2013

AUD/USD: Attempting Triangle Breakout

The aussie dollar has fallen to a major support level provided by the lower boundary of the multi-month triangle it has been moving in on the long-term charts. It looks poised to break lower after showing even more weakness today. It has broken down through the monthly pivot which was adding its weight to support at 0.9835. However, a daily close below 0.9780 would be necessary for indicating a breakout. A move below 0.9580 would also give even stronger confirmation. The downside target if the triangle breaks lies at 0.8050.

EUR/USD: Consolidating On Key Trend-Line

Eurodollar continues to consolidate at the critical 1.2860-70 level where the weekly and monthly pivot and the trend-line for the move up since summer '12 are all situated and offering support. A bounce higher is possible with - first 1.2930 at the consolidation range highs providing initial resistance - and then if that is broken 1.3000. A close below 1.2860, however, would provide confirmation of a bearish breakdown with a downside target of 1.2580 initially. A decisive move below 1.2840 might also indicate further downside to the same level.

USD/JPY: Consolidating In Up-Trend

The exchange rate is in an up-trend but consolidating again in the 102.50s. It will probably go higher to 104.00, the target generated by the breakout from the recent ascending triangle. 104.00 is also where the weekly and monthly pivots lie. Momentum is a little overbought now however, so it is also possible the current consolidation could extend sideways for longer, or even possibly break-down, with a move below the 101.75 range lows falling to 101.25, followed by the pivots at 100.70.

Analysis By: Joaquin Monfort, Forex4you Analyst

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