EUR/USD ââ,¬â€œ The EURUSD is little changed ahead of the NFP release scheduled for 8:30 am EST.  We maintain that this weakness is likely the beginning of a much larger correction of the 5 wave bullish affair from 1.1640 to 1.3367.  Major support is not until the June high at 1.2976.  Short term support is at the 12/18 low at 1.3051.  Initial resistance is at the 1/3 low of 1.3145, which is reinforced by the 38.2% of 1.3296-1.3061 at 1.3151.  5 short term waves down from 1.3296 with the final 5th wave as an ending diagonal suggests a rally attempt in the short term. Hourly RSI has also broken higher from bullish divergence.

USD/JPY ââ,¬â€œ The USDJPY held at the resistance line drawn off of 121.38 and 119.87 and has declined to the 20 day SMA at the 118.00 figure.   Additional support is at the 38.2% of 114.42-119.67 at 117.67 followed by the 50% at 117.04.  The daily is showing a symmetrical triangle from the 121.38 high in December 2005 (along with the inverse head and shoulders within the triangle).  Triangles are often 5 waves ââ,¬â€œ and this weakness looks like the beginning of a 5th wave down within the triangle.  Alternating legs of triangles are also usually related by the golden ratio ââ,¬â€œ 61.8%.  Well, 61.8% of the 119.87-114.42 leg is 337 pips ââ,¬â€œ when subtracted from the recent high at 119.67 ââ,¬â€œ we arrive at a possible terminus for this leg of the triangle at 116.30.  The 61.8% retracement of 114.42-119.67 happens to be 116.43.  In summary, 116.30/43 looks like a very attractive area before a major rally attempt takes place. 

GBP/USD ââ,¬â€œ Cable continues to break down, as the pair is below the 12/18 low of 1.9432.  The pair is coming up on support from the 38.2% of 1.8515-1.9846 at 1.9337.  The short term (hourly) picture is similar to EURUSD in that it looks like a short term bottom is forming.  A double divergence with RSI is evidence of a short term bottom.  A push above 1.9432 targets the 38.2% of 1.9747-1.9349 at 1.9500.  The next major support level is not until the confluence of the 50% fibo of 1.8515-1.9846 / 11/10 high at 1.9178. 

USD/CHF ââ,¬â€œ The rally today has stalled at the 50% of 1.2769-1.1878 at 1.2324.  The pullback that we were looking for yesterday seems to be taking place.  Fibonacci support begins at the 38.2% of 1.2110-1.2335 at 1.2249 (reinforced by 1/04 low at 1.2239).  A deeper correction could extend to the 61.8% at 1.2197.  Still, it is important to remember that it looks like the larger trend has turned up due to the impulsive 5 wave advance from 1.1878.  Resistance above todayââ,¬â"¢s high (1.2326) is the 200 day SMA at 1.2391.

USD/CAD ââ,¬â€œ The USDCAD rally has stalled at the 4/3 high of 1.1771.  With overbought daily oscillators, bears may see some relief.  However, a resistance line from a potential bearish channel rests at 1.1878 today, just above the 50% of 1.2732-1.0927 at 1.1830.  That level is most certainly flooded with stops, which if taken out, the 11/15/2005 high at 1.1975 could be seen.  As mentioned though, overbought conditions may lead to a correction first, with the 12/29 high at 1.1667 as initial support.

AUD/USD ââ,¬â€œ The decline from .7979 is convincing and the next support area is the 12/15 low at .7778.  The bearish divergence that preceded this decline along with 5 waves up from .7414 grants confidence to the bearish case.  The decline has stalled today ahead of the .7800 figure.  Support there is reinforced by the 12/27 low at .7807.  A break below encounters aforementioned support levels while a correction higher ââ,¬â€œ which is favored by hourly RSI divergence, encounters fibo resistance at the 38.2% of .7979-.7810 at .7874.  

NZD/USD ââ,¬â€œ Kiwi has been charred as the pair has tested .6890 in moring trading.  The interpretation is similar to other majors.  That is, an impulsive 5 wave decline suggests that this is the beginning of a deeper decline.  However, 5 waves down also begs for a correction.  Resistance begins at the 38.2% of .7096-.6893 at .6970 (also the 01/04 low).  But a break below .6893 may give way to the confluence of the 23.6% fibo of .5927-.7096 / 12/6 low at .6814/21.

Jamie Saettele is a Technical Currency Analyst for FXCM.