Forex Technicals: The Day Ahead, October 8

Daily Forex Technicals | Written by DailyFX | Oct 08 08 02:23 GMT |

The EURUSD gained for the first day since 9/25. Evidence suggests that this is the beginning of a larger USD decline. EURUSD The path that I outlined last night is proving correct so far; 'the decline from 1.4871 is an impulse (5 waves) and indicates that a short term low likely forms soon. The ensuing advance should prove corrective. When the advance gets underway, expect strength until at least 1.3911. This is the 4th wave of one less degree.' There is no change here. Additional strength could reach the mid 1.41 level (former resistance and Fibonacci at 1.4138/70). USDJPY I wrote yesterday that '100 is the next level that will be put to the test. Former support just shy of 103 (102.81 to be exact) is potential resistance as is the breakout level of 103.50.' The USDJPY came right into the mentioned resistance zone and price was turned back. Price should remain below 103.28 going forward. GBPUSD The GBPUSD decline from 1.8675 is now in 5 waves and price broke below the September low to confirm the longer term bear. An advance, although corrective, should begin soon. I am expecting the advance to reach at least the 1.7843-79 area. USDCHF The USDCHF exceeded 1.1422. The advance is in 5 waves (as is the EURUSD decline from 1.4871) so a 3 wave corrective decline is expected to begin soon. Initial support is at 1.1215 and the Fibonacci zone begins at 1.1178. USDCAD The advance from 1.03 is in 5 waves so we should see a corrective decline begin soon in the USDCAD. Support begins at 1.0830, although a deeper decline is likely. AUDUSD Price has reached the .70 figure but there is no evidence that the decline is over. If a larger correction unfolds, then look for resistance in the 7416-.7517 area going forward. This is former congestion and a Fibonacci level. Be aware that COT positioning indicates potential for a bottom to form soon though. The next bearish objective is near .65. NZSDUSD The drop below .6435 confirms that wave 5 (within the 5 wave drop from .8219) is underway (possibly near completion). With 5 waves down (although no evidence that wave 5 is complete), there is the possibility of a significant bottom forming soon. DailyFX Disclaimer Investment in the currency exchange is highly speculative and should only be done with risk capital. Prices rise and fall and past performance is no assurance of future performance. This website is an information site only. Accordingly we make no warranties or guarantees in respect of the content. The publications herein do not take into account the investment objectives, financial situation or particular needs of any particular person. Investors should obtain individual financial advice based on their own particular circumstances before making an investment decision on the basis of the recommendations in this website. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. All intellectual property rights are the property of Daily FX. Daily FX and its affiliates, will not be held responsible for the reliability or accuracy of the information available on this site. The content herein is provided in good faith and believed to be accurate, however, there are no explicit or implicit warranties of accuracy or timeliness made by Daily FX or its affiliates. The reader agrees not to hold Daily FX or any of its affiliates liable for decisions that are based on information from this website. Daily FX highly recommends that before making a decision, the reader collects several opinions related to the decision and verifies facts from at least several independent sources.