All is looking good, I thought, as I laid my head on the pillow last night. Actually, EUR/USD and USD/CHF have done nothing wrong. In fact, currently, they look just fine and dandy. Then I moved on to GBP/USD and AUD/USD… the lands of black pudding and witchetty grubs… Not so fine and dandy… This has placed me in a quandary. We now have what appears to be a rather difficult conflict. Maybe they can diverge but it sure makes for uncertainty.
Lets just start by confirming the very satisfactory development in the two Continental Europeans. The two have worked well together and as long as we begin to see the dollar resume higher, this should now satisfy my outlook. However, given the confusion over the Commonwealth parties, it may be prudent to keep an eye on the Continentals to ensure their outcome actually develops…
Even in the Commonwealth parties, there is a rather strange disconnection – limited upside for AUD/USD and more substantial room on the upside in GBP/USD. Best work with AUD/USD that has a more defined outcome – I think – but with GBP/USD, there are more doubts, and it may be best to now sit out and wait for a clear structure developing.
USD/JPY didn’t do anything much wrong either but still just a little bit wrong… This could allow some neutral development to occur – some downside risk but should later generate upside. Being in the middle of the range, it would be better to wait for the extremes. As for EUR/JPY, the pullback higher looks good except in terms of fitting this into the larger degree wave structure. There is a potential problem here too – and therefore it would be best to let price make up its own mind – could even make a marginal new high.
Take care today – best employ the two Continental Europeans that seem to have a solid structure…