Bias: We'll have to take care here - a cap either expected at yesterday's 0.8089 high or at 0.9121
Indeed, the break above 0.9038-53 provoked extension to the 0.9083-0.9121 area which has capped. Momentum is now showing clear bearish divergences so we need to take care as a reversal is due. However, I can still see an argument for a final push to 0.9121 so we'll need to look for breaks. We could even see a decline to the 0.8940-51 area and still see this move to 0.9121. Thus, if we see this move to 0.8940-51 and a bullish reversal pattern develops then follow this with the potential move to 0.9121. Only a break of this high would imply 0.9158 and then a reversal.
9th October: I went through the daily chart this morning and I still see the current levels as a barrier and thus only above the 0.9121-58 resistance is going to keep this motoring higher to 0.9206 and 0.9279.
Yesterday's high came in 6 pips above the 0.9083 resistance. It may even be the final high for a larger correction but I'd want this confirmed. Should we either get a direct retest of 0.9089 or a bounce from the 0.8940-51 support there is still risk of a test at the higher 0.9121 resistance. Thus, only an earlier break below 0.8940 would open up the risk of a more sustainable correction lower. Below 0.8940 would extend losses to 0.8919 and 0.8899 followed by the 0.8850 pivot support.
8th October: I still view the bearish divergences in daily & weekly charts and targets between 0.9038 and 0.9121. Look for a bearish reversal pattern. While a long way away, a break below 0.8625-75 will trigger a much stronger reversal.
For a full description of how to use the analysis please see the Analysis page of my website. The prior day's set ups for potential trading levels highlighted in the report are now available on the Daily Forecast page of my web site.