Daily FX Research Team

Jamie Saettele
.
www.fxcm.com
sales@fxcm.com
DailyFX jsaettele@dailyfx.com
Senior Currency Strategist
1.212.897.7660
1.888.50. FOREX (36739)
Dollar Consolidation Should Lead to Additional Gains

LATEST TRADING VIDEO: Major Implications the EURUSD patterns

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BIAS MAY
05/07/2010 BIAS CHANGE OBJECTIVE
EURUSD BEAR 13115 TBD
GBPUSD FLAT
AUDUSD FLAT
NZDUSD FLAT
USDJPY FLAT
USDCAD BULL 10200 TBD
USDCHF BULL 10900 TBD
GOLD BULL 1156 >1230
CRUDE FLAT

Long Term Trends and Pivot Points (monthly data) (updated on first of the month)
TREND S3 S2 S1 PL PH R1 R2 R3
EURUSD DN 1.2694 1.2981 1.3245 1.3520 1.3542 1.3795 1.4082 1.4346
GBPUSD DN 1.4248 1.4514 1.4848 1.5081 1.5149 1.5449 1.5715 1.6049
AUDUSD UP 0.8669 0.8801 0.8986 0.9093 0.9145 0.9303 0.9436 0.9620
NZDUSD DN 0.6584 0.6717 0.6911 0.7014 0.7074 0.7238 0.7372 0.7565
USDJPY UP 84.35 86.24 89.85 90.88 92.60 95.34 97.24 100.84
USDCAD DN 0.9438 0.9749 0.9951 1.0207 1.0316 1.0463 1.0774 1.0975
USDCHF UP 0.9992 1.0240 1.0389 1.0588 1.0687 1.0787 1.1035 1.1184

Medium Term Trends and Pivot Points (weekly data) (updated every week)
TREND S3 S2 S1 PL PH R1 R2 R3
EURUSD DN 1.2894 1.3048 1.3214 1.3362 1.3375 1.3535 1.3689 1.3856
GBPUSD UP 1.4938 1.5064 1.5220 1.5332 1.5361 1.5502 1.5628 1.5784
AUDUSD UP 0.8996 0.9077 0.9177 0.9247 0.9267 0.9358 0.9438 0.9538
NZDUSD UP 0.6966 0.7009 0.7090 0.7114 0.7152 0.7214 0.7257 0.7338
USDJPY UP 89.53 90.56 92.26 92.96 93.62 94.99 96.02 97.72
USDCAD DN 0.9587 0.9758 0.9873 1.0016 1.0072 1.0159 1.0330 1.0445
USDCHF UP 1.0353 1.0477 1.0601 1.0726 1.0726 1.0850 1.0974 1.1098
 Euro / US Dollar
Daily Bars

Prepared by Jamie Saettele

There is no change to my outlook for additional EURUSD weakness over the next several weeks and months.
Clearly, the downtrend has accelerated and there is the possibility of a short term bounce (or a triangle
formation…let it play out). 12860 to 12935 is potential resistance near term. There is a short term Elliott channel as
well that I’ll post on the ForexStream.

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 British Pound / US Dollar
60 Minute Bars

Prepared by Jamie Saettele

As focused on for weeks, the 3 wave GBPUSD rally was completely retraced and additional weakness is likely.
14840-14940 is potential resistance. A rally to there may complete a small 4th wave prior to weakness in a small 5th
wave that ends below 14475.

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 Australian Dollar / US Dollar
Daily Bars

Prepared by Jamie Saettele

Recent commentary was that “I remain focused on the reversal from two Monday’s ago (AUDUSD), which brings
forth the potential for a double top with the November 2009 high at 9400. However, bears have been unable to
register a close below the short term support line (not to mention the longer term channel line). Of note is the dark
cloud cover candle pattern on the weekly (bearish reversal).” The AUDUSD has plunged and the next level of
interest on the downside is the February low at 8575. 9000 and 9130 are potential resistance levels.

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 New Zealand Dollar / US Dollar
Daily Bars

Prepared by Jamie Saettele

Since the October top at 7640, the NZDUSD has stair stepped lower. The structure of the decline at this point is 3-3-
5, which is the substructure of a flat. However, there are several variations that would allow for the beginning of a
larger decline. As long as price is below 7446, I lean towards a long term bearish position. Watch the top of the
short term channel for a break.

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 US Dollar / Japanese Yen
Weekly Bars

Prepared by Jamie Saettele

After yesterday’s extraordinary decline and bounce, I want to take a look at the weekly in order to gain perspective.
The decline from the 2007 high is viewed as a leading diagonal. Leading diagonals are often followed by sharp
second wave advances (sometimes as much as 78.6%). The 61.8% and 78.6% levels are 10915 and 11577. Trading
above 9500 would put the pair back on track towards those levels.
 US Dollar / Canadian Dollar
Daily Candles

Prepared by Jamie Saettele

Recent commentary was that “the USDCAD has bounced from its lowest level since June 2008. RSI has broken to a
new high (following divergence at the low) and the USDCAD has broken through its 20 day SMA. Consider that 12
month rate of change has turned up from an historically low level and the bullish evidence presented commands
attention.” The pair has soared and broken above its channel. Favor the upside…price ideally remains above 10200.

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 US Dollar / Swiss Franc
Daily Bars

Prepared by Jamie Saettele

From a simplistic point of view (which is often the best view), price action since February top has been nothing
more than a sideways correction. I am moving risk on longs up to 10700. The spurious (non-Elliott) channel
has served as resistance but I am looking for a break higher. Risk can be moved up to 10900.

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 Gold
Daily Bars

Prepared by Jamie Saettele

Gold’s year + channel continues to hold and yesterday’s rally through 1170 suggests that something big may be
in the works. A bullish base has formed and a 3rd of a 3rd wave rally may be underway. I favor this
interpretation as long as price is above 1156 (previously 1124). Targets are above the 1230 high.

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 Light Crude
Daily Closes

Prepared by Jamie Saettele

A look at daily closes warns that the slightly upward sloping trend over the past 10 months may be a large
distribution (topping) pattern. Crude has dropped below its 20 day SMA now as well. Of note is that the
rally/consolidation from the 2009 low consumed roughly twice the amount of time as the preceding decline.
7915 and 8170 are resistance levels.

Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Friday
evenings), technical analysis of currency crosses on Monday, Wednesday, and Friday (Euro and Yen
crosses), and intraday trading strategy as market action dictates at the DailyFX Forum. He is the author of
Sentiment in the Forex Market. Follow his intraday market commentary and trades at DailyFX Forex
Stream. Send requests to receive his reports via email to jsaettele@dailyfx.com. Traders can meet me
at the FXCM Expo in Las Vegas on May 3rd and 4th. You can register to attend at
www.fxcmexpo.com.
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