New Low In EUR/USD, GBP/USD Remained Firm

The new low in EUR/USD was a source of great puzzlement and it took some time to solve. The puzzle was deepened because I had forecast the 1.3553 level as a potential target just before Christmas so when it was hit perfectly it tended to cause concrete to harden in my mind and to see it break caused doubts to set in. However, GBP/USD remained firm and USD/CHF, while seeing a deep correction, did not make a new high. What’s more, a bearish EUR/USD outcome would truly make my mind explode in terms of not only the EUR/USD but the entire implications from EUR/USD through GBP/USD and EUR/JPY. However, after a quick nap and sucking my thumb for comfort, I spotted the alternative. All should be ok now.

However, that all said, we have the Non Farm Payrolls tonight. The last NFP performed perfectly through the retracement from 1.3677 to 1.3619 – a correction I had forecast two weeks in advance. All being well, it should work its miracles again. Out of prudence it will be better to sit patiently on hands and wait. I am certain, one way or the other, it will provide the basis for the next directional move.

The AUD/USD appears to have confirmed further losses. It should see losses again today but then a correction. If I have misjudged the structure (which is rather complicated) then it’ll probably do very little. However, the end result, whether today or next week, should be lower.

The USD/JPY was in a rather mixed situation yesterday and I think that’ll continue today. I still feel there’s another low to come but the underlying direction remains higher and this looks like causing the same outcome for EUR/JPY.

Thus, the vast bulk of today will probably be more of a case of sitting and watching small vertical lines moving very slowly up and down in a very narrow range but should be followed by the customary panic and frenetic whipsaws that will take us on a more defined journey.