EUR/USD â�,�“ The picture from yesterday is very much the same, as the EURUSD decline from the 1.3367 is not very inspiring but it looks like there are already 5 waves up from 1.2761.  Thus, the EURUSD may be tracing out a flat correction.  This means that going forward â�,�“ another high above 1.3367 before a more impulsive decline is possible.  Ultimately, probability favors a decline as the next move of consequence towards the 38.2% of 1.2761-1.3366 at 1.3136.  Favoring the larger turn lower scenario is the fact that daily CCI has declined below 100 but RSI remains overbought above 70.

USD/JPY â�,�“ USDJPY broke above the short term resistance trendline at 115.25, exposing the 38.2% fibo of 118.46-114.42 at 115.95.  Resistance there is reinforced by the 200 day SMA at 116.11.  Still, the rally today to 115.67 could have completed a 3 wave correction â�,�“ in which case the most probable move is lower below 114.42 to test the 7/10 low at 113.42.

GBP/USD â�,�“ Similar to EURUSD, the scenario has not changed much from yesterday. Cable appears to be nearing the end of a 5 wave bullish sequence from 1.7046.  The 5th wave of this advance began on 10/11 at 1.8515 and is likely near the end of its 3rd wave.  Thus, what is left is a corrective move lower (which looks to be occurring now) and perhaps one more high above 1.9846 before a multi month decline begins to correct the advance from 1.7046.  Fibo support begins at the 38.2% of 1.8834-1.9846 at 1.9461.  Support at that area is reinforced by the 11/27 gap opening high at 1.9463.

USD/CHF â�,�“ The USDCHF may very well be forming a base from which to work higher.  An inside day at the lower Bollinger Band on the daily occurred on 12/4 â�,�“ which has the tendency to mark bottoms.  That candle was also a doji.  A rally above the 12/4 high at 1.2006 gives scope to additional gains with focus on the 11/29 high at 1.2116.  1.1898 needs to hold in order for the immediate bottoming scenario to play out.  Similar to the EURUSD, CCI has indicated a potential reversal as the indicator has increased above -100 but RSI remains below 30.

USD/CAD â�,�“ The larger uptrend remains in place above the support line drawn off of the 9/1, 9/28 and 10/30 lows.  A shorter term support line is drawn off of the 11/28 low at 1.1285 and the 12/5 low at 1.1379 (see below).  Only a decline below the mentioned supporting trendline suggests the potential for a significant downside move.  That line is at 1.1282 today and increases 4 pips per day.  The next bullish target is the 4/13 high at 1.1533.  Daily oscillators remain above midpoints and thus bullish.

AUD/USD â�,�“ We presented two scenarios yesterday â�,�“ â�,��"Fridayâ�,��"�s a bearish reverse hammer candle warns of a pending correction of the nearly vertical move higher and that correction may be in its early stages now with price testing yesterdayâ�,��"�s low at .7847 this morning.  Daily RSI has crossed below 70 â�,�“ which instills confidence in a move lower.  On the other hand, a bullish pennant could be forming since the .7921 high on 12/1.  In this case, a thrust higher past .7921 would be the favored view.  A decline below .7842 would more strongly argue for the bearish scenario.â�,�  Price action since yesterday favors the first scenario.

NZD/USD â�,�“ The Kiwi dollar shot through the 12/4 high at .6905 today but Wednesdayâ�,��"�s doji still suggests a larger downturn.  As we mentioned yesterday, daily RSI has broken below 70 for the first time since 9/4.  That signal resulted in a nearly 200 pips drop.  In addition, a 5 wave advance from .6574 appears to have taken place thus wave structure too favors the downside with an initial bearish target at the 38.2% fibo of .6574-.6920 at .6788.

Jamie Saettele is a Technical Currency Analyst for FXCM.