Tech Musings - currencies

AUD has corrected sharply and is one of the weakest currencies.  I have been consistently bearish on AUD in my previous post on 21^st May 2013 and 3^rd march 2013. AUD which was trading at 1.02 in March has made a low of 0.9176, which is approximately 10% deprecation in less than three months.

If we look at the current chart of AUD we can see that it had done 38.2% retracement of the entire rise from the low of 0.65 to high of 1.11. AUD looks week on charts and I expect it to correct further but it may see minor pull backs before it resumes it downtrend. Ultimate target for AUD is around 0.85 or below.

The next chart is of CAD. CAD has been very reluctant to break above 1.05 levels. If we look at the given chart I think we are just nearing “Eureka moment” CAD may depreciate sharply from the current levels and move towards 1.20 levels by the end of 2014.

In my previous post on INR written on 21^st May 2013, I wrote that “Finally it seems that INR has given a break out. If we look at the given chart we can see that INR is clearly breaking out of long term consolidation which lasted almost 1 full year. I think finally INR is ready to resume its downward spiral and we will see it trading around 60 if not more by the end of this year.”

INR has deprecated almost 13% since then. If we look at the given chart of INR we can see that the deprecation in INR has been sharp as expected. I think that INR should consolidate between the range 56 - 60 for atleast few weeks before it can finally cross 60. Year end target for INR is at around 62 – 64 and long term target for INR is at around 70 – 72.

 

In the same post I wrote that “I think the rally in yen is overstretched and as we can see from the charts yen is trading near significant resistance. Yet I feel yen may have some more steam left and may move to 105 levels before it finally starts its retracement. As I have mentioned regularly, I am a long term bear on Yen and see it moving towards 112 and 120 levels in next few years.”

JPY almost topped out at those levels and fell to 94 which was almost 10.5% correction from the top of 103.8. If we look at the given chart of JPY we can see that it had done 38.2% retracement of the entire rise from sub 80 levels to high of 104.

JPY should consolidate between 91 -104 before it finally breaks out and move towards target of 120 or higher. Reader can go short on JPY at 91 – 94 and keep a stop loss of 84 and target of 120 with six to 12 months time horizon.

 

In my previous post on GBP I have mentioned that “If we look at the next chart we can see that GBP is consolidating in a symmetrical triangle and any breakout above 1.65 will take GBP towards 2 USD levels.”

But instead of a upward breakout GBP has broken down from the symmetric triangle pattern. The immediate target for GBP will be at around 1.40 levels.