FX CURRENCY WATCH
months) would alter the mixed, neutral/ bullish medium-term outlook.
NOTE: EUR/JPY monthly close back above 125.90 in July 2017 terminated further long-term declines. We are forecasting a rally to retest 141.05 through January 2018 in a sharply higher outlook [127.55 – 141.05] through the first quarter of 2018.
USD/CHF USD/JPY
I am sorry to again state one of my strongest beliefs about the currency market; that the Swiss Franc remains the bellwether, proactive currency. Te continuation through the first quarter consolidation and cross rate rotation combine in this currency. Every time the USD/CHF appeared to break out to the upside, EUR/CHF would decline, thus dampening any bullish momentum back to neutral. Each time the USD/CHF would break out to the downside, EUR/ CHF would rally to its high and again neutralize any bearish momentum in USD/CHF. As a result, the USD/CHF remained only neutral/bullish.
USD/CHF USD/JPY
As in our previous quarterly article, aſter the rally through 111.45 [forecast for January 2017] to 118.65, the subsequent monthly close back below 114.15 in January 2017 terminated further strong medium-term rallies. We have completed the forecast decline to 109.20 for April 2017, and we continue to forecast the
28 FX TRADER MAGAZINE October - December 2017
subsequent retest of 115.75 through October 2017 in the resulting lower, choppy medium-term consolidation [ 108.15 – 116.05] through January 2018. Only a monthly close still below 108.40 (reigniting bearish medium-term momentum and resulting in a decline to retest 103.90 over two months) or a monthly close above 116.75 (resulting in a strong retest of 123.65 over three
In light of this continued price action, the rally to 1.0340 about 1% from the medium-term objective for January 2017 leſt the medium-term techs eroding to neutral from bullish. EUR/CHF again declined toward the 1.0625 medium- term pivot point and dampened the bullish medium-term techs in USD/ CHF. Inversely in July and August 2017, the decline to the .9445 critical monthly close [similar to 1.1305 in EUR/USD] was supported by the recent strong 6%
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