I have been trading Forex for more than 5 years and it doesn't surprise me when it seems to take forever to change a trend. I continue to point out, there are important key trend-lines that are holding. As long as they are, the risk to the upside remains.

Going into the last week of the month, I would expect a lot more wild volatility like we saw on Friday.

Remember the KEY TREDN LINES on the dailies.

USD Index - Potential ending diagonal unfolding - 79.50 is still KEY RESISTANCE

EUR/USD - Here too may be a forming diagonal

GBP/USD - Did not join the rally on Friday. Is it lagging?

AUD/USD - Topping? or allowing for one more push?

NZD/USD - Another tough call. Watch key trend-line

USD/JPY - I would expect a rally then a drop

USD/CAD - Another key trend line to watch

I have been trading Forex for more than 5 years and it doesn't surprise me when it seems to take forever to change a trend. I continue to point out, there are important key trend-lines that are holding. As long as they are, the risk to the upside remains.

Going into the last week of the month, I would expect a lot more wild volatility like we saw on Friday.

Remember the KEY TREDN LINES on the dailies.

USD Index - Potential ending diagonal unfolding - 79.50 is still KEY RESISTANCE

EUR/USD - Here too may be a forming diagonal

USD/GBP - Did not join the rally on Friday. Is it lagging?

AUD/USD - Topping? or allowing for one more push?

NZD/USD - Another tough call. Watch key trend-line

USD/JPY - I would expect a rally then a drop

USD/CAD - Another key trend line to watch

I have been trading Forex for more than 5 years and it doesn't surprise me when it seems to take forever to change a trend. I continue to point out, there are important key trend-lines that are holding. As long as they are, the risk to the upside remains.

Going into the last week of the month, I would expect a lot more wild volatility like we saw on Friday.

Remember the KEY TREDN LINES on the dailies.

USD Index - Potential ending diagonal unfolding

EUR/USD - Here too may be a forming diagonal

USD/GBP - Did not join the rally on Friday. Is it lagging?

AUD/USD - Topping? or allowing for one more push?

NZD/USD - Another tough call. Watch key trend-line

USD/JPY - I would expect a rally then a drop

USD/CAD - Another key trend line to watch

I am posting an Elliott Wave count on the Dollar index that I put together last Thursday and as I always say: "If correct", it suggests a larger turn is at hand.

The next few days, weeks and months could be quite interesting in all markets.

Dollar Index - Due for a some strength?

EUR/USD - The week ahead for this pair is quite important in establishing the trend

GBP/USD - This pair is also sitting at a pivot point

USD/CHF - This pair is a difficult read

USD/CAD - Is the bottom in place?

AUD/USD - Interesting candle formation

NZD/USD - Another reversal candle pattern on the daily

USD/JPY - This pair has good break-out points defined

EUR/JPY - Again a pair that is in the middle of a range but has a defined break-out line

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/13/2009 – NZD/USD – Price action on NZD/USD, a daily chart of which is shown, after having broken out above a confluence of resistance early last week (that included the key 0.6600 resistance level and a long-term downtrend resistance line extending from the March 2008 highs), hit a high just above 0.6800, pulled back to re-test the 0.6600 new support level, and has currently recovered to re-test the 0.6800 resistance level once again. This appears to be a classic pullback after breakout that could signal a resumption of the current prevailing uptrend if price is able to breakout significantly above the 0.6815 uptrend high, which represents a 10-month high for the pair. In this event, further upside resistance resides in the 0.6950 price region. In the event of another downside pullback move, the 0.6600 level should continue to provide support for the pair.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/12/2009 – GBP/CHF – Price action on GBP/CHF, a daily chart of which is shown, has been displaying a close adherence to and respect of certain technical levels, both in the form of horizontal support and resistance levels as well as angled trendlines. After respecting the 1.8100 resistance region last week with a bearish bounce off that level, price action has just touched an exceptionally valid uptrend support line that has been in place since the beginning of the year, with at least five price touches since the trendline’s inception. As of Wednesday (8/12/2009), current price action has respected this trendline once again with a tentative bounce up off the line. A continuation of this bullish bounce should target the 1.8100 level once again. Any significant breakdown of this trendline should target further major support in the general 1.7450 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; chart patterns in white; 50-period simple moving average in light blue.)

8/11/2009 – EUR/JPY – After approaching resistance in the 139.00 price region, price action on EUR/JPY, a daily chart of which is shown, has respected that resistance zone by beginning a possible reversal of the short-term uptrend that has been in place since early July. This bearish turn has manifested itself in a tentative breakdown of a significant uptrend support line. In the event of a close and bearish continuation of the breakdown below this trendline, a clear support target further to the downside resides in the key 131.00 price region. Major upside resistance continues to reside in the 139.00 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/10/2009 – GBP/USD – Price action on GBP/USD, a daily chart of which is shown, has made a dramatic bearish correction after hitting a 9-month high of 1.7040 on an upside breakout last week. As of Monday (8/10/2009), this bearish correction has erased all of the gains made on the strong breakout above both the 1.6740 level as well as a short-term downtrend resistance line extending from the early June swing high. Currently, continued bearishness is approaching a key uptrend support line extending from the March low. If this trendline is respected, price could potentially bounce at or near the line to target the 1.7040 resistance high once again. If this trendline is breached significantly to the downside, a clear longer-term support target resides around the 1.5750 price region, which also represents a 38.2% Fibonacci retracement of the entire bullish trend from the March low to the 9-month high reached in early August.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

I do think that for the week to come the overall potential is for USD strength but I would suggest that further evidence of a break-out would be in order by way of breaking the the six month old major trends-lines.

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/07/2009 – AUD/USD – Price action on AUD/USD, a daily chart of which is shown, has approached resistance around 0.8500 before correcting back down to a new short-term uptrend line extending from the mid-July 0.7700 low. The current bearish correction could potentially go on to breakdown below this trendline and reach towards further support in the 0.8260 support/resistance region. To the upside, a continuation of the current prevailing uptrend would be confirmed on a breakout above the 0.8470 high. In the event that price continues up above the noted 0.8500 support/resistance region, a significant further resistance target to the upside resides around the 0.8800 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/06/2009 – USD/JPY – Price action on USD/JPY, a daily chart of which is shown, continues to consolidate just under a key downtrend resistance line extending from the early April high. This downtrend line exists within the context of a significant parallel downtrend channel. Within this channel, price has been following a short-term uptrend support line extending from the bottom of the channel in early July. Within the past week, price has poked tentatively below this countertrend line several times, but was unable to break it in any significant manner. Within the context of the overall downtrend, a breakdown below the current uptrend retracement line is a key event to watch for. In this event, a clear downside support target resides in the major 91.00 support/resistance price region. In the event of any significant breakout above the parallel downtrend channel, price should meet immediate further resistance around the 97.00 level, and then further up at around the 99.70 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

8/05/2009 – EUR/USD – The key breakout above 1.4335 that occurred in the beginning of this week on EUR/USD, a daily chart of which is shown, has not followed-through as of yet. Instead, price has consolidated right above the point of break. Though this breakout represents a tentative continuation of the uptrend that has been in place since early March, the move will have failed without a subsequent breakout above the 1.4445 high that was reached after the prior uptrend high of 1.4335 was broken on Monday. If a breakout above 1.4445 indeed occurs, a significant upside resistance target resides around the 1.4570 price region. And any breakout above that level would constitute a substantial bullish indication for the pair that could eventually reach up towards further resistance in the 1.4900 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

I am a bit of a contrarian. I would ask the question this week of; When is too much just simply "Too Much"?

I would not be surprised if we see a blow off and reversal some time this week or next. Good trading.

USDIndx - Watch for action around this triple bottom.

EUR/USD - Will this pair triple top? or break out?

GBP/USD - Searching for a new top?

USD/CAD - Getting into oversold territory again.

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/31/2009 – NZD/USD – Price action on NZD/USD, a daily chart of which is shown, has been consolidating around major resistance in the 0.6600 price region for the last two weeks. This consolidation mirrors recent price action in other dollar-based currency pairs. Not only does the current resistance represent the key 0.6600 horizontal support/resistance region, it also represents a major long-term downtrend resistance line extending all the way back to March 2008. Therefore, this pair is currently at a critical juncture. Momentum readings on the displayed Stochastics are showing the pair in prolonged overbought conditions and pointing down. If resistance is respected with a bounce to the downside, a major downside support target resides around the 0.6100 price region. In the event of any strong breakout above the current confluence of resistance, a key upside resistance target resides around the 0.6800 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1

(Price on 1st pane, Slow Stochastics on 2nd pane; horizontal support/resistance levels in yellow; uptrend lines in green; downtrend lines in red; 50-period simple moving average in light blue.)

7/30/2009 – USD/JPY – Within the context of a significant parallel downtrend channel, price action on USD/JPY, a daily chart of which is shown, has formed a counter-trend support trendline. The parallel downtrend channel extends from the 4/6/2009 major high, and price is currently approaching the top border of this channel. Since this pair is currently entrenched within a clear downtrend, the event to watch for from a high-probability, trend-trading perspective, would be any breakdown of the counter-trend support uptrend line that extends from the 7/13/2009 low. In this event, a clear downside support target resides in the key 91.00 support/resistance price region. Any breakout above the parallel downtrend channel should meet immediate further resistance around the 97.00 level, and then further up at around the 99.70 price region.

James Chen, CMT
Chief Technical Strategist, FX Solutions

To download the latest version of FX AccuCharts 7.1, please click here: Download FX AccuCharts 7.1