Stock market today: S&P 500 climbs as ongoing AI-led rebound pushes tech higher
Many of the pullbacks were a little stunted on Tuesday. The only one that I really caught well was the EUR/USD, which stalled 1 point below the upper end of the retracement target. Given the wretched development over the past week, I’ll not be too hard on myself but the moves do, in general, slot into the underlying move from about 2 weeks ago. We do seem to be progressing nicely into a terminating point and a move back in the opposite direction, and this seems to be appropriate across all the six currency pairs I follow. Keep your eyes peeled for signals.
If there is any single area that could spoil the fun it’s going to be down to hourly momentum that looks quite bullish in the USD/CHF, bearish in the GBP/USD and AUD/USD, while the EUR/USD has quite a decent bullish divergence. If anything, it’s the 4-hour momentum that is showing more consistent Dollar bearish divergences across the whole group. If hourly momentum is going to re-develop divergences, it does suggest a longish period of consolidation at some point to allow it to develop a pullback. When the price makes its Dollar highs, we may just see potential for an hourly divergence also. It therefore sounds as if Asia will have its usual lacklustre day.
The JPY pairs were surprised by an earlier resumption of gains. Well, the correction in the EUR/JPY was in the right retracement zone, and only the USD/JPY failed to deepen as much as I would have liked. I’d suggest watching the USD/JPY in that case, as it may well complete this part of the rally with a reasonably deep correction at some point. Broadly both are on track, and the rallies are developing quite well, despite the limited correction in the USD/JPY. We do seem to have fairly definable targets from the higher wave degree – even if there are two potential targets. However, these are pretty well the only targets available at this point.
I feel it is best to wait for the extreme target areas to be approached to take advantage of the reversal.
If there is any single area that could spoil the fun it’s going to be down to hourly momentum that looks quite bullish in the USD/CHF, bearish in the GBP/USD and AUD/USD, while the EUR/USD has quite a decent bullish divergence. If anything, it’s the 4-hour momentum that is showing more consistent Dollar bearish divergences across the whole group. If hourly momentum is going to re-develop divergences, it does suggest a longish period of consolidation at some point to allow it to develop a pullback. When the price makes its Dollar highs, we may just see potential for an hourly divergence also. It therefore sounds as if Asia will have its usual lacklustre day.
The JPY pairs were surprised by an earlier resumption of gains. Well, the correction in the EUR/JPY was in the right retracement zone, and only the USD/JPY failed to deepen as much as I would have liked. I’d suggest watching the USD/JPY in that case, as it may well complete this part of the rally with a reasonably deep correction at some point. Broadly both are on track, and the rallies are developing quite well, despite the limited correction in the USD/JPY. We do seem to have fairly definable targets from the higher wave degree – even if there are two potential targets. However, these are pretty well the only targets available at this point.
I feel it is best to wait for the extreme target areas to be approached to take advantage of the reversal.