It would have been nice if the States had a week-long
public holiday. Clearly it’s nice to have a day’s break to refresh but coming
back to a dull market, almost paranoid market, is not much fun. Having said
that, Friday brought some mild surprises that have required a minor re-think.
EURUSD performed not far away from expectation although the follow-through
lower was a bit limp. It was interesting to see USDCHF make a minor new high
while GBPUSD was more surprising in extending losses.
What’s to be made of these developments? A mixed bag
really. GBPUSD is now generating both hourly & 4-hour bullish divergences
so that needs watching. I feel there is still one more low to come there.
USDCHF has developed an hourly bearish divergence but no 4-hour divergence but
we have to allow for the fact that we can hardly call the move higher from
0.9021 a trend. EURUSD has a limp hourly bullish divergence but no 4-hour.
However, it does have the potential for an inverse head & shoulders – still
to be confirmed.
Throughout the Europeans the hourly and 4-hour Price
Equilibrium Clouds are flattening. Thus, we are on a state of alert but with
what appears to be risk of one more Dollar high. After that a reversal looks
possible.
Of all the pairs it was USDJPY that turned higher more
robustly and a little earlier than expected. I’m not convinced of direct gains
yet. Indeed, I feel there is more potential for sideways range trading. That
could still allow a new high but at this point the development I see doesn’t
seem to be consistent with a runaway rally yet. The outlook I see in USDJPY
seems to be consistent with EURJPY also. While it has recovered moderately
firmly there’s a certain lack of logic in where it’s reached and the structure
in which it has developed. Thus, both JPY pairs are still under scrutiny.
Thus, for the near term I’m not expecting massive
moves. If there is anywhere to look for strong moves it may well be in the U.S.
equity market…
Steady as she goes today. Be aware of what constitutes
a break of the consolidation…
Have a profitable week
Ian Copsey
So is that up or down for the US equity markets? I know that you are looking for a major top but I am not quite sure that we are there yet. Regards.
ReplyDeleteI think you have seen now.
ReplyDeleteAs for whether it is the final high I hope you don't mind that I do not comment as I have a duty to my subscribers.
Yep, got the blip higher and now the sell-off. Don't mind at all. Going to be interesting to see how greedy people really are or if fear takes a proper hold. Regards.
ReplyDelete