Analysts Look For Trend Continuation And Breakouts At Week's Open

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Analyst picks for: 2009/01/19
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At the week's open, many of the trends that were in development through the end of Friday were unraveling. However, as liquidity filled out with European and North American traders, these counter trends have been quickly dampened. While volatility is clearly high, what can we expect from market direction? Our DailyFX Analysts weigh in on developed trends and the potential for breakouts.

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Chief Strategist Antonio Sousa

My picks: Short AUD/JPY
Expertise: Economics and Behavioral Finance
Average Time Frame of Trades: 1 month​

Today, most U.S. financial markets are closed down to honor the Martin Luther King Day holiday. However, don’t expect to have a quite session in the currency market. In fact, liquidity has been so thin that relatively small orders can potentially move exchange rates up or down by a couple of pips. In any case, risk aversion combined with de-leveraging in the financial sector is likely to continue helping lower yielding currencies like the Japanese yen. I have been short AUD/JPY since the beginning of October, when the currency pair was trading at 70, and I expect the Australian dollar to fall further against the Japanese yen in the first half of 2009.

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Senior Currency Strategist Jamie Saettele

My picks: short AUDUSD, against .7275, target below .60
Expertise: Technical
Average Time Frame of Trades: 1 month​

5 waves down from .7275 and 3 waves up from .6534 confirms that the larger trend remains down. Near term, a complex correction could lead to a push above .6846 but the trend is down and there is potential for a drop below .6005 as long as price is below .7275.

Open trades:

short USDJPY: against 94.67, target below 80
long USDCHF: against, 1.1095, target 1.15

Other Analyst Picks:

  • Currency Strategist John Kicklighter: Short USDJPY
  • Currency Strategist Terri Belkas: Long USD/CHF on a break above 1.13
  • Currency Analyst David Rodriguez: Watch for a Euro/US Dollar bounce near 1.3150
  • Currency Analyst Ilya Spivak: Remain short EURUSD
  • Currency Analyst John Rivera: Short USD/JPY
  • Currency Analyst David Song: Pending Short NZD/USD (Below-0.5640-50 - 50.0%

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