Wednesday, September 6, 2017

Twisted, mixed up-side down and tangled

What a mess the pairs are in. Of all, it was GBPUSD that sprang the biggest surprise by breaking above 1.3012… So, that set me scrambling to work out what has happened and also to discover how this may play out. Certainly, it still has some upside to go. Strangely, while EURUSD had been the pair to spring an unexpected sharp move, it remained quite subdued while it looked at GBPUSD pushing higher. I could try and suggest that EURUSD will follow-through to catch up with GBPUSD but it’ll be better to let that happen rather than forcing any rally…

Probably, of all the 4-majors, the most complicated is USDCHF. Indeed, it has some serious risk of a highly complicated development. I sense that we may be seeing an expanded flat but it’s certainly a messy pair. Keep well away until it begins to become tamer.

As for USDJPY, I have it tentatively finding its low. Thus, we need test the upside with a break above 108.87. That should confirm the low but I still see risk of limited gains initially. It has also coincided with a low in EURJPY. Therefore, the balance between, what should be, a bullish USDJPY and a rather messy – will it-won’t it – rally in EURUSD. The question still remains whether it will hold below 1.1979 or a break above. Both options are open. If both pairs are bullish then the cross is going to look pretty firm – but it should just be a correction.

Finally, the Aussie completed its (green) Wave -a-/-iii- so now needs a pullback and later – maybe today … but could be tomorrow… further gains will be required.

Good trading
Ian Copsey  

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