Friday, June 19, 2015

Unconvincing…

That was an interesting day. It wasn’t what I had expected. Levels where deeper corrections should have occurred only generated shallow retracements and structures developed skewed. That’s another way of saying that what I thought was happening… didn’t. In turn, that implies an alternative outlook. In particular, on its adjustment, USDCHF looks less bearish than I had expected. The possible ascending triangle in EURUSD displayed no thrust. GBPUSD, while stronger than I had expected, is looking tired at these levels.

Do I feel we’ll see further Dollar losses? Yes – but not direct. Will the subsequent follow-through be robust? I have my doubts. Looking at correlated development across the Europeans I now have a more conservative outlook for today that would suggest a similar style of development as we have seen recently – nervous, even uninterested development provoked by a general nervousness about the political background where no one wants to go out on a limb for fear of the catalyst for which the market has been awaiting.

Any clues outside of Europe? Well, AUDUSD confirmed the larger double bottom although not by any significant level. However, it’s no flat correction that can trick the market into such patterns. So what happens next will be important but it’ll take today and possibly into Monday to really confirm the double bottom I think.

USDJPY? Well, as suggested, the risk was for a new low and I suspect we shall see further. EURJPY is rather mixed and while I feel it has completed the current local rally, the correction does have potential to be relatively shallow. Thus, it does suggest either EURUSD or USDJPY will need to drive the cross higher at some point but the balance of these two is rather mind boggling so I’d suggest watching the individual pairs initially but with the expectation that, at some point, EURJPY can top out.

Could be a slow end to a weird week…

Have a great weekend
Ian Copsey  


No comments:

Post a Comment