Markets did not
go far since yesterday’s US close, as speculators are sitting on their hands
ahead of the US NFP report today at 12:30GMT. Expectations are 178K; if news
will be better than this, let’s say around 200K, then be aware of a strong push
higher on USD Index that will cause weaker majors. At the same time US bonds
could extend the decline based on QE tapering because of good data. Markets
however may not be ready for tapering just yet, there is a lot of risk involved
especially in stocks, and as a result we could see a spike higher on US stocks
futures on good number but then sharp bearish reversal on speculation for
tapering.
On the
other-hand, if data will be bad then stocks may not go far but EUR, GBP and
others will find a bid, but only temporary, because our wave patterns are
pointing for strong USD. Lets take a look at EURUSD and USDCAD
On EURUSD prices
fell sharply yesterday from 1.3220 which could be start of a larger impulsive
weakness. The reason is also a current bounce from 1.310 that has qualities of
a corrective move. As such, bias remains bearish. Intra-day resistance is seen
at 1.3150, at 38.2% Fibo level. Any rise back to 1.3220 will put pair in
bullish mode, but only temporary for a larger corrective rally.
EURUSD
30min
On USDCAD we can
see lower prices, but based on the wave structure since end of August we
suspect that pair is in final stages of a corrective move, called a flat
correction. Wave (c) already has five waves down, so be aware of a bounce.
Break above 1.0515 wave (iv) point will suggest that flat is complete and
bullish moves underway.
USDCAD
1h
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