Quiet Day Ahead, With Risk of Terminal EU Announcement

The analysis was broadly on track on Friday, in some cases precise. It tends to maintain the structures I have proposed, but given the underlying nervousness about the Greek debt issue, there will always be the potential for a sudden break of structure with a mad free for all. Clearly, the market already knows that, and thus the pattern of defensive development we have experienced.So what does this mean for the start of the week? Well, given the structure I have, it does suggest further dollar weakness in general. However, there will always be the risk of complex corrections or sideways drifting that allow the market to put off actually making a defining break. No one really wants to get caught out with a bad position. Overall, I am pretty convinced of the eventual move. The only issue is the extent of any current moves that makes identifying stop losses rather difficult – but once it does, we are due a solid directional wave.The market has just opened, with EUR/USD and USD/JPY both gapping higher. That’s pretty good for EUR/JPY, but bear in mind the potential for a sideways consolidation within the recent range. I’m not sure this will spark strength in the cross just yet. Otherwise, the other pairs have opened with minimal reactions.I suspect we’ll see a relatively quiet day – but of course with the risk of a terminal announcement from the EU…

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