Market Update – April 27

EURUSD 4 HOUR

The EURUSD decline from the 3/27 high is in 3 waves.  Since this decline succeeds a 5 wave rally from the March low, it’s possible that the rally from last week’s low is either a C wave or a 3rd wave.  Last week’s low is also on the lower channel line from the 2019 high.  This line has provided support numerous times since September (zoomed out view of the channel is below).  Near term entry is unclear but keep an eye on the line off of the 3/27 and 4/14 highs for a breakout.

AUDUSD 4 HOUR

A test of .6449 could complete 5 waves up from the March low.  In fact, the rally from 4/21 appears to be unfolding in 5 waves itself.  If AUDUSD takes out .6449, then be aware of 2020 VWAP (currently .6523…see futures chart below) for potential resistance.  Bottom line, I’m still partial to the short side in AUDUSD and awaiting either slightly higher or for a break under the short term red trendline.

4/23 – We had a good start with AUDUSD on the short side but it was short lived.  I still like it lower, for all of the reasons mentioned recently.  Those reasons include bearish seasonals, resistance from the long term channel center line (hit today again), and the 61.8% retrace of the decline from 12/31 at .6449.  I’m looking at either shorting a test of .6449 or a break below .6314.

AUSTRALIAN DOLLAR 4 HOUR

USDJPY 4 HOUR

USDJPY action since 4/14 resembles a small bearish flag.  The ‘break’ lower isn’t much of a break yet but I lean towards the short side as long as price is below the high volume level at 107.80.  Eventual downside focus is 104.62 (2 legs down from 3/25).  Another reason to like USDJPY lower is that Yen futures held VWAP support last week (see futures chart below and remember that support in Yen is resistance in USDJPY).

4/22 – USDJPY has gone quiet.  I don’t see anything to do until either waiting for a short into 108.50 or shorting a break below the line that crosses off of the 4/15 or 4/21 lows near 107.40, especially because Yen futures are holding both VWAP from the March low and VWAP from the April low (see below).  Remember, support on Yen futures is equivalent to resistance on USDJPY.

JAPANESE YEN FUTURES 4 HOUR