I mentioned a couple of days ago that because we are in a corrective phase there would be risk of complications setting in. Well, it has happened earlier than I had bargained for… Two of the pairs that I suggested had clearer outcomes were EURUSD and GBPUSD. Both listened carefully to my thoughts and decided to do the opposite. I can cope with GBPUSD although it does suggest quite serious implications for early next week. It may well be the same for EURUSD but I’d rather sit back and let today develop. All I could see from yesterday’s development was complicated corrective behaviour and with some ominous signs from GBPUSD, it may be best to approach with care.
USDCHF rallied well yesterday although it appears to be approaching a barrier. Therefore, the risk of a correction lower is very much on the cards. However, this is a pair that still needs to be handled with kid gloves – so take care.
AUDUSD didn’t see the deeper correction and this triggered losses that then broke below my anticipated target – but following a shallow correction, this would have been the implied outcome. It has approached a key support, even if temporary, so don’t expect a repeat of yesterday…
The JPY pairs continue to confound. However, I feel I may have discovered the reason and need to test this out today to confirm my suspicions. It tends to suggest further consolidation within the current wide range between 115.50 - 121.84. Quite what this means for EURJPY is a conundrum. EURUSD has become engorged with confusion while USDJPY, as mentioned, is due to go nowwhere it seems. This doesn’t really provide us with many clues for the cross – except, until there is greater clarity in either EURUSD or USDJPY, it remains a pair that is best left alone.
Care today – there’s an awful lot of confusion around…
Have a great weekend