Better than expected GDP numbers provided us with an extra 4th good reason to sit tight with our long NZD/USD trade. As we already said, from a technical and EW perspective we are currently tracking the second corrective wave upwards. Our projected final target is between the 0,50% and 0,618% Fibo retracement area above 0,69. Right now we are in a third wave of the first A second wave leg. So after we see 5 waves up, we should face with the retrace down, and that would be the perfect time to add again to our long position, around 0,6550.
The UK better than expected retail sales 0.3% vs -0.2% led the GBP/USD to spike up and to resume the bullish uptrend. The first strong resistance level at 1.3311 and -0.38% Fibo retracement comes as the first big hurdle to the upside. So we are staying in a wait and see mode, closely monitoring price action for further confirmation.
As you can see on the chart, EUR/USD is right on our projected path it has overcome the previous high, which can be a good confirmation that the pullback is not likely in the current counting. The area around 50% Fibonacci retracement or 1.1930 is our target under this long approach with the strong reason that wave A and wave C tend towards equality in length, and that retracement for the pullback of the second wave usually comes to 0,50 to 0,618% Fibo levels.
DAX is rising on our projected route, with kind of impulsive mood, which can suggest that we could face some higher highs later, but not before some minor pullback right on a significant Fibonacci retracement level. The bigger picture is not quite yet clear enough, and there are a few potential scenarios. We will observe, wait and see.
From an Elliott wave plus technical viewstand, we do not see any major changes in our projected direction on USD/JPY. The pair is testing the resistance, and any time soon could start the pullback for the leg e, of the 4th wave triangle. When we see clear impulsive 5 wave down, that will be the confirmation sign, and we will wait for the pullback to sell USD/JPY. Wait for the confirmation.