Forecasts for 2012

EUR/USD: The downtrend should continue as the YS2 at 1.1815 is on the radar. Any corrective move should be contained by the 38.2% level of YR1>YR2 at 1.3767. That level also matches nicely with the current bottom of the weekly cloud at 1.3763.

USD/JPY: The favorable scenario is to see the upside contained by the YR1 at 79.65, even tough it is possible to see a move as high as circa 81.15. The YS2 at 71.34 should be hit. Considering the latter matches nicely with the 50% mark of the decade’s S1>S2, there promises to be some fireworks in that circa area.

GBP/USD: The YS1 is 1.5121. After there is a correction from that level, watch for 1.5080. It promises to be an explosive move to the YS2 at 1.4712, once it is broken. Upside containment should be the YR1 at 1.5941 if not a little beyond that.

USD/CHF: If the YS1 at .8402 is so much as touched this year, then the YS2 at .7417 is on the radar. Watch for the mid--.9900’s. If broken convincingly, then it is the express to the YR1 at 1.0372. The next stop after that could possibly be 1.0731. It promises to be a volatile year for the Swissy.

EUR/CHF: The YR1 at 1.3207 should contain all upside action this year. The monthly kijun at 1.2606 promises to be a strong obstacle. The weekly kijun at 1.1270 is still a reasonable target to the downside. The YS1 at 1.1113 could only be a temporary holding point if the pair makes it that low. The YS2 at 1.0066 would be visited if the YS1 gives out.

AUD/USD: There is still a possibility of a drop to circa .8311. If we got that drop this year, then it would effective wipe out all the year’s S&R downside objectives. The YR1 at 1.0711 needs to contain any thoughts of this pair moving higher.
It should also be noted that LT, circa .8311 contains, as this would be viewed as a LT correction to a LT uptrend. This pair should be hitting the decade’s R1 at 1.1538.

USD/CAD: I mentioned in this week’s Weekly Forecast that 1.0059 is on the radar. That could end up being the key mark for the whole year. If it contains, then the dip we saw to .9891 from the recent peak at 1.0656 will be it, as we see the rise to the bottom of the monthly cloud at 1.1059. The YS1 is .9836 and the YR2 is 1.0948, so if 1.0059 contains, then the bottom of the monthly cloud is well within range.

NZD/USD: This pair is moving higher to start the year. The combination of the monthly tenken and weekly kijun at .8106 is a strong confluence of R. With the YR1 at .8287, that zone should be the extent of the move north for the year. As long as that is the case, then we’ll say the move to the monthly cloud top at .6850. The YS2 is .6742.

EUR/GBP: I gave away part of this forecast for 2012 in the Weekly Forecast. Expect containment on the downside for the year to be the YS1 at .8111. The reversal will take the pair to at least the YR2 at .8768. There should be a move beyond that mark. The decade’s S2 is .8145, so that is going to be a very explosive area. The dip to that area looks like it could be it for the whole decade, as most likely the LT rise will take ascent to the decade’s R2 at .9585.

EUR/JPY: This is going to b a little different, but I have to report what I see. I’ve been saying this pair is going to drop to the low 90.00’s, and that has been a target for a long time. This is the year it is going to happen. The only problem is the YS1 is 93.03, which is not deep enough, and the YS2 is 86.48, which conjecture tells me it is too deep. If I take 50% of the distance of those 2 points, then I get 89.76, so that is the level I am going with.

GBP/JPY: Watch for 117.68. The mark will be broken this year, and when it does, it will bring a quick drop to the YS1 a 113.01, and then we’ll see the drop continue to the YS2 at 106.53.