Sometimes I get tired of waiting for the market to get in with trading. Recently it has been pretty boring and occasionally stagnant but there are signs of a more progressive development beginning to evolve. We should soon see global indices begin to wake up – not quite yet, but the signs are constructive. Likewise, the dollar does appear to be creating the potential for a stronger directional move. It’s not going to happen today, probably not tomorrow either, but by next week there could be signs of the market hotting up.
Today? Well, I suspect a modest move but probably more corrective and that is likely to retain a defensive outlook. This suggests a return into the recent consolidation zone and that should maintain the status quo for now. Therefore, there seems to be little risk of sharp moves today.
We have a long descending channel in USD/JPY at this point. It wouldn’t surprise me that it could retain that channel for a day or two more. Needless to say, breech will trigger a firmer move. Overall, the 4-hour Price Equilibrium Clouds are courting price very closely and that tends to suggest a break can occur at any time. This is reflective of not just USD/JPY but all three Europeans, the Aussie and EUR/JPY.
Thus, maintain a keen eye for the break levels that will take us back into the range today…