EUR/USD Correcting Higher
EUR/USD corrected up to our 1.4183 level Friday, and subsequently pulled back to 1.4123. A further pullback is possible, but will likely hold the 1.4086 or 1.4066 support levels. The chart shows a ST angled cycle-up (light blue) that has completed 2 channels plus a .414 “extension”, which in our Quadricycle analyis, is a typical corrective cycle. The fact that it only corrected a Fibonacci 23.6% indicates a further countertrend rally is likely. The flat cycle-up (brown) has a 2nd channel target at 1.4222, and a 2nd channel extension target at 1.4253, just beyond a Fibonacci 38.2% correction.
USD/JPY hits downside target
USD/JPY is in a complex cycle pattern at the moment. On the chart, the thick dark green lines show the LT up-cycle, which has completed just over two channels to the upside, minimum for a correction. If the LT cycle is still up, we would likely do four channels to the upside, projecting up towards the 97.50-98.50 area. However, a minimum upside correction is complete, and we have begun a MT down-cycle (purple). This angled cycle has completed two channels plus our “extension”, .414 of the previous channel. If the LT cycle has turned to the downside, this cycle would continue out to four channels, targeting the 86.50 to 87.00 area. In the ST, support is at 89.78, and resistance at 90.57 and 90.71.
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