Retracement in the Markets, Relief Efforts Underway

Watching EURGBP with interest:

EURGBP headed for the stars?

As evident on the chart, price action in the pair has steadily narrowed over more than 2 years and looks ready to rocket higher. Will look for a daily close above 0.8710 for further confirmation. There's a good chance of a false break, so it won't hurt to wait for a clearer picture as there's obviously a huge move ahead if EURGBP comes out of consolidation.

Meanwhile, no clear picture yet in EURUSD after the 1.40 rejection and recovery from under 1.39. A EURGBP breakout will likely send it past recent highs, or see a  slide in GBPUSD; we'll see - I favor a EUR break. And in Japan, BOJ keeps pumping money into the market.....

Relief buying (it's called a retracement) in the stock markets have sent the indices back up but the damage is done. Only a move back above 9500 in Jun Nikkei futures will take out our remaining short, while the market is vulnerable to any aftershocks (it's the pun thing again).

Let's see how the day unfolds.