The new week opened up in Sydney where it closed out on Friday in the NY session. EUR/USD is still looking to find a bottom, USD/JPY continues to show strength and USD/CAD is looking to recover after a brutal sell off.

The EUR/USD weekly target of 1.1360 we mentioned back on September 26th is still in play. Last week’s buyers in EUR/USD did not see much follow through and profit taking should emerge above 1.1610 initially. On the outside chance there is an extension beyond these levels, 1.1665-75 in EUR/USD should see new sellers emerge. Once last week’s downside support level breaks at 1.1525-30, the next area where buyers should emerge would be 1.1465-75.

Sterling GBP/USD on the other hand saw a rally last week and high of 1.3655. GBP/USD already coming off a retracement of it’s downtrend is searching for a high to call home before it’s next leg back lower. We believe that a rally above last weeks high into the 1.3665-75 area will be enough to squeeze the weaker shorts. After this takes place, renewed selling should emerge setting the tone for a move back lower towards 1.3420.

Dollar Swiss USD/CHF maintains is bid posture, although not moving on it’s own. Instead USD/CHF movement has been more a function of cross related activity. We believe more of the same will persist in this coming week. The weekly range should be contained between .9200 and .9375.

USD/JPY closed near it’s high’s last week at 112.20. Both USD/JPY and Yen related crosses showed continued strength. There appears to be more upside left in USD/JPY till 113.00/10 to squeeze out any remaining shorts. Beyond this area, 113.30/40 should see some fresh selling arrive to cap the short term rally.

Dollar Canada USD/CAD saw strong selling via both dollar movement along with unwinding of Cad related crosses. The recent close below 1.2490 on Friday at 1.2470 turns the daily trend into negative territory along with confirming a weekly trend down. While medium term implications call for a move lower still to 1.1800, daily price action is currently oversold. If further selling persists below 1.2425, this has the makings of a bear trap which should fuel a rally to 1.2600/10 to clear out the weaker short positions. See picture below of the daily chart.

Aussie dollar AUD/USD has now traded above the prior top at .7316 twice, but failed to close above either time. This has been a price level which AUD/USD needs to close above on a daily basis to see this pair trade higher. Until this occurs, we see price action limited to .7335 on the upside. If we see daily close below .7270, Aussie should be headed lower again.

Kiwi NZD/USD has been trading sideways since the move lower after the Reserve Bank of New Zealand’s rate hike. The weekly and monthly charts still call for further slippage to .6550 from the current price of .6935. However, we see the downside support coming near the .6835/45 level for this week with .6970/90 containing the topside of this pair.