It was hardly a constructive day – but then I hadn’t really expected any spectacular moves. I’m not really expecting much today. We appear to be in a temporary lull, not just in Asia, but across the market following the rapid rally in EUR/USD while the rest of the market could only offer somnolent reactions.
I have to admit that there is a certain complexity to the balance of the market – not the long-term outlook, but more the lower time frame development. I’m pretty certain that GBP/USD is on the right track. We just need the others to sort themselves out. However, somehow I feel today could provide enough information to be able to generate a more directional move.
There is one element of which we need to be aware. That is the tough year we have seen overall and the approach to the holiday season when, frankly, the market doesn’t really like to do very much. I tend to find that Decembers are either tedious and wrapped up in complex corrections or, with the depletion of liquidity, the alternative is for sharp trending moves. Thus, we shall need to wait and see which of the two will entertain us over the coming month.
Basically, we should be looking for key break levels that can trigger the next move – whether this be corrective, ending or trending.