Forex Ichimoku Report – Aug . 31st

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EURUSD – A weak cross but below the 3
After climbing for 8 out of 9 weeks, the EURUSD got slammed but then took a pause underneath the Tenkan – which ironically has just posted an upward cross.  This really creates a cross situation, whereby the TKx move up and sharpness of the Tenkan angle suggests short term is with the bulls, however the pair is below all three lines (tenkan, kijun and 20ema).  This is generally not a favorable buying position.  Combine that with the thick kumo and we really are not in a position to buy.  Light sells could be had where all three lines converge around 1.2900 but the pair could be setting itself up for another downward TKx below the Kumo which could create a bold move towards the yearly lows and possibly lower.  Sit and wait for the next play is suggested.

USDJPY – 3 out of 11
Since the pair posted a medium TKx sell signal way back in late June, the pair has only been able to climb 3 out of 11 weeks.  Although the trend is not straight, its consistent with small pullbacks.  The pair seems to want to pullback to the previous weeks high but anytime its posted a weekly gain, the next week was a solid loser on a weekly basis.  Thus, you can wait for a weekly gain or a pullback to the previous weeks high and then look for a sell.  Caution is advised as the language about possible intervention is getting stronger, but this has not stopped the JPY from gaining.

USDCHF – Headed to .9900?
This pair has managed to scoop up two weekly gains in the last 12 or 1 in 6.  Meaning 15% of the weeks, it will gain if the move continues which is a very low percentage for bulls or a great one for bears.  Now that the pair has cleared our support at 1.0200, 1.0130 and the 2009 lows around .9900 seem like they are on deck.  The tenkan is diving at falcon speed and this should provide resistance to any short term pullbacks.  Just consider the fact the CHF will benefit in a risk averse environment and as long as the economic numbers continue to come out this bad, the CHF will continue to gain.  Expect further losses.

EURCHF – Held by the Kijun for 10 months
Yep, the EURCHF has been held (or unable to break) the Kijun (or close above it) for over 10 months.  Each major pullback has landed right in its lap and rejected there sparking further sales.  Although its far away from current price action, there are other options.  We have to keep in mind the pair is carving out new lows as we speak (all time lows that is) so pullbacks to previous weeks highs or strong closes offer us an opportunity to get back in short.  1.3000 is nearby and another option but with the Tenkan, Kijun and 20ema diving this fast, everything points to further losses.

CADCHF – Kumo Break – 1st in over a  year
After posting some impressive gains, the CADCHF after making its yearly highs 12 weeks later busted through the kumo over 1500pips lower.  This week is the first likely close below and this likely will setup a move to .9000 as there are no fib levels left to prop this pair up.  All CHF pairs are suffering and its unlikely the SNB will intervene for now as it has completely failed in the last several attempts to contain CHF pricing.  Expect further losses with small tests at .9400 and .9250.  Beyond that, the big figure at .9000 looks a likely target.

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