I can’t say anything went particularly wrong yesterday in the Europeans. GBP/USD played a nasty game in dipping back below 1.7002 by 1 point to then move back higher. Although annoying, it doesn’t change the final expectation so I’m basically comfortable with this slight twist. Indeed, last week’s forecast still remains intact – just developing very slowly.
Now the Continentals are a different kettle of boiled fish. In some ways the development appears normal. However, the problem that has arisen is the balance across the fractals in terms of the targets I have. Does this mean my targets are awry, or does it mean that the structure is morphing into a more complicated correction? I suspect the latter mainly due to the still-on-target GBP/USD. Therefore, I’d suggest a greater level of due care and attention for the Continentals and a stronger preference to work with GBP/USD that has more defined targets.
AUD/USD also sprung a surprise, pushing back above 0.9437 but not 0.9460. I can’t say that either hourly or 4-hour momentum is showing any sign of reversal. Indeed, there’s probably a greater indication of follow-through. While the short term structure is a little mixed, there’s some uncertainty about targets. However, it does look more like the upside has further to go.
USD/JPY is also at an important juncture. While I can still see a bullish foundation, it is now rather teetering on the crowded foundations. Direct follow-through is now a “must” else we’re going to suffer a more complicated outcome. There is a narrow supporting range that should price dip slightly, could provide an alternative foundation. Much is going to depend on its first move. In EUR/JPY the combination of both USDJPY seeing a deep correction and a modest dip in EUR/USD, provided a negative development in the cross. This raises a series of alternatives that should be noted from today’s analysis…
Be cautious today. The potential for surprises appears high.
Which stock should you buy in your very next trade?
With valuations skyrocketing in 2024, many investors are uneasy putting more money into stocks. Unsure where to invest next? Get access to our proven portfolios and discover high-potential opportunities.
In 2024 alone, ProPicks AI identified 2 stocks that surged over 150%, 4 additional stocks that leaped over 30%, and 3 more that climbed over 25%. That's an impressive track record.
With portfolios tailored for Dow stocks, S&P stocks, Tech stocks, and Mid Cap stocks, you can explore various wealth-building strategies.