Bias: I look for a dip to the 1.6358-87 area before seeing the next leg higher
Yesterday's gains were quite impressive. However, I feel they may well have completed this part of the correction at 1.6585. However, I can't say the correction has been too deep and we should therefore be aware of the risk of the possibility of a minor new high. However, I feel the risk of reversal is probably too high and would prefer to sell into any rally rather than ride any move up. If we move above 1.6567 the chances of a new high become stronger but I'd still expect the 1.6585-1.6621 area to cap. Thus, only a break above 1.6621 would see a spike up to 1.6653-87 before lower again.
9th September: The rally has been developing as suggested and we have only completed two sections of the correction. Thus while 1.6350-00 supports I still look for a final rally (probably by next week) above 1.6621 but then we'll have to watch resistance at 1.6687 and 1.6732.
I prefer a scenario calling for the current strength we are seeing this morning to be a correction higher and thus it shouldn't move above the 1.6567-85 area. However, wait for a bearish reversal pattern to confirm as there is a minor risk we could see a small extension into the 1.6585-1.6621 area. Thus, at all stages be aware of the risk of a bearish reversal pattern developing. Assuming the high is below 1.6585 I feel we should quickly move down to the 1.6482 low seen thus far and then watch supports at 1.6430-37 and more likely somewhere between 1.6358-87.
9th September: Another leg higher has been seen and it looks like we'll get a better selling opportunity above 1.6621 - most likely around 1.6653-87 or as high as 1.6732. Only an earlier break below 1.6322-58 would send price lower directly.
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