I didn’t enjoy doing yesterday’s analysis. There were too many points to measure, over too long a period and not enough time to fully absorb the alternative possibilities. Having completed the analysis and going over some new alternatives I have begin to feel a little more comfortable. The outcome, all arrived at independently, was quite encouraging in terms of the general correlation that I would expect and that all the currency pairs fit snugly into their own implied structure. Thu, I feel a lot more confident of the next stage.
As we start the day, it looks like we shall see the habitual correction during Asian hours. Perhaps it could extend into some of the European morning. However, there are signs that the Dollar longs will unwind further and which has quite well defined target areas. Even then, there is a strong chance that we’d only see a correction to today’s expected targets.
The Aussie didn’t quite go as expected. However, I see that I was a little too direct with my projections. Here we should see further gains but which may well react more strongly following another push higher. Perhaps this can occur at the natural targets suggested for the Europeans. Overall, this still has a continuing bearish outcome.
The JPY pairs… USD/JPY dipped a little lower than I would have liked but did recover well to head up into the higher end of the consolidation area. Like the Europeans, I think it’s due a move back lower and this is where the whip will crack one way or the other. I tend to prefer higher. This also appears to be implied by EUR/JPY although it should begin the day on a soft note. Thus, the expectation will be to buy on dips.
Be aware that the 4-hour Price Equilibrium Clouds should limit the Dollar downside for a while and this suggests an initial (at least) limited trading range.