EUR/USD has broken below $1.34 and as the chart below suggests the range which has been "managed" during the last few months has been violated.

Targets in the mid $1.20’s are now firmly on the agenda in the longer term, but beware of some erratic behavior as the EU struggles to keep its cool with all kinds of frenzied initiatives designed to look like it knows what it is doing with respect to deteriorations in the sovereign debt picture for Greece, Portugal etc.




Spot gold is at a critical level on the hourly chart. From reviewing the daily chart there is support between $1085 and 1090, but should that fail, then there is quite an abyss below.



The DAX is not celebrating upbeat economic news within the EU this morning but seems to be watching the FX market closely. The irony is that any relief on the Greece crisis will be seen as yet another excuse for equities to rally not only in Germany but elsewhere, including the US.



Some time ago I played with the scenario that USD/JPY could at some stage rally (i.e. indicating yen weakness) and that a decisive break above the 92.50/93.00 level would violate a very long-standing descending wedge formation. In trading Wednesday morning, the Japanese currency is not benefitting from risk aversion brought on by the plumetting euro which is noteworthy in itself.

Trading during the next few hours on this currency pair will be well worth monitoring since, despite an RSI level approaching 80 on the chart below, there could be a mad scramble to exit the yen if levels near to the 93 level are penetrated.



Sometimes recommendations made here are for long-term position traders such as the one made below from a couple of weeks ago with respect to JC Penney

Yesterday’s break above the cloud on strong volume, which validates the recent breakout above the downward trend which took place in mid-February, suggests that J C Penney (JCP) has plenty of upside potential in the intermediate term.




Clive Corcoran is the publisher of TradeWithForm.com, which provides daily analysis and commentary on the US stock market.