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Global stocks bounced after strong Micron guidance revived AI sentiment following a tech selloff. Equities hold key support, suggesting a possible short-term recovery, while the U.S. dollar may face pressure amid mixed signals from Treasury yields and DXY wave structure. Metals remain near lows but could see corrective rebounds. All attention now turns to U.S. PCE inflation and GDP data, which may set the next market direction.
USDJPY has resumed its recovery and is trading back near the 2024 highs, despite earlier intervention efforts by the Bank of Japan. However, the rally may be in the final stages of a Wave 5 of Wave C structure, with five waves already visible on the 4-hour chart, while a break below the rising channel would strengthen the case for a significant bearish reversal in the weeks or months ahead.
In this Elliott Wave webinar, Grega Horvat reviewed the latest developments across global markets, including the US dollar, US-Iran negotiations, stocks, commodities, and currencies. He also shared key Elliott Wave insights and highlighted potential market scenarios ahead of important economic data releases.
6B, the futures contract tracking the British pound against the US dollar, has spent the past month caught between resilient domestic data and an unpredictable geopolitical backdrop, leaving the Pound oscillating without committing firmly to a direction even as recent sessions brought a sharper selloff. The Pound has traded choppily over the past month as the Bank of England held its key rate at 3.75 percent on June 18, while traders weighed the inflationary impact of renewed US-Iran clashes near the Strait of Hormuz earlier in May against a subsequent ceasefire memorandum that points toward de-escalation, alongside signs of cooling UK price pressures and renewed questions over Prime Minister Keir Starmer's leadership. Technically, the pair remains locked in a broad sideways range between 1.3781 and 1.3189 that has persisted since May 2025, with the past two trading days bringing an aggressive selloff back toward the lower end of that range. Looking ahead, the 1.3189 level is the line in the sand, and how price behaves around it should determine whether the next move is a recovery toward the range midpoint, a breakout above the yearly VWAP, or a deeper slide toward the 1.30 and 1.273 areas.
When looking at the dollar, it would not be a surprise to see some setback because after all we can count five waves up from the 99.10 level, and this could allow for some pullback in the near term. Pullbacks should then be structured by three waves, so an A-B-C decline is something that we should be aware of over the next few sessions. It could be just another fourth wave before a fresh rebound, but for now it may be better to wait on the sidelines and see what happens early next week, with support around 100.00.
The Japanese Yen has spent much of 2026 compressing toward the politically charged 160 per dollar level, a threshold historically associated with Bank of Japan intervention. After a confirmed intervention on April 30 briefly pushed the Yen back toward the 0.00645 area (Daily Level 2), sellers reasserted control and price has since grinded back down to 0.00625 (Daily Level 3). With Japan's producer price inflation printing at a three-year high of 6.3% year-on-year in May and the BOJ's June 15-16 meeting now fully priced for a hike to 1.0%, the Yen sits at a critical inflection point where the next meaningful move will likely be determined by whether buyers can defend 0.00625 or whether a fresh breakdown forces Tokyo's hand once again.
Dive into today's market action with the Blue Line Futures Metals Minute! (Episode 680)
As price approached the resistance yellow box, our clients were informed upfront about it and Elliott Wave structure suggested that the recovery was nearing completion. The rally lacked the characteristics of a new impulsive uptrend and instead continued to drop impulsively, started developing as a three-wave corrective move. Based on that view, we warned that a reversal lower could emerge from the highlighted resistance region.
CADJPY has seen a very nice push higher recently after we identified a wave four retracement, but now price is coming down from around 117.50 and is even trying to break the lower trendline support near 115.50. This suggests that even if this turns out to be just a temporary pullback, there is still room for more weakness, possibly into wave E of a larger triangle, or alternatively this could be a wave four correction.
Aussie is again on the rise after stabilizing at the previous swing support around 0.7100, so it now appears that the drop from the first half of the week was only a wave B flat correction. That means the higher degree recovery away from the 0.7080 area is still in play and could continue as a counter trend movement, although the upside may remain limited with wave C now potentially moving into the 0.7180 to 0.7200 resistance zone. For that reason, there is still a chance that the pair turns lower again while the market trades below the 0.7278 invalidation level, which was the high from the beginning of May.
NZDJPY has broken out of its previously completed wave four triangle, confirming the end of the consolidation phase discussed in the May 12 update. The pair is now transitioning into a potential wave five advance, signaling renewed bullish momentum toward higher upside targets.
The fact that gold declined so much on "nothing" is truly profound.
The 6E futures contract has been range-bound between 1.150 and 1.186 since June 2025, with 1.168 acting as the defining pivot since March. After buyers successfully defended and held above that level through April, sellers have more recently reasserted themselves in May and pressed prices back below the range mid. The macro backdrop is pulling in both directions simultaneously, with USD headwinds from the Moody's downgrade and ballooning fiscal deficits competing against a hawkish ECB pivot and an unresolved US-Iran conflict that continues to suppress Eurozone growth and fan inflation. The coming weeks will be defined by whether 1.168 flips back to resistance or gets reclaimed by buyers, with directional resolution likely to follow whichever side commands that level with conviction.
Aussie is seeing a pretty strong selloff here, so it’s possible that we already saw the top of wave five. Notice that price broke below the trend line support of that bullish channel, which makes us think that wave five may already be completed and that we could see much deeper weakness later on. In fact, we see an impulsive drop from the highs, so we may now be stepping into a higher degree A B C decline, meaning that after B wave rise, pair could see much more weakness. Plus, we have seen a weekly close around 0.7136 level, which seems like important confirmation that the trend is reversing, which after all has been expected because of the higher degree completed 5-wave structure visible on the daily chart.
Markets are starting to realize that delayed action can keep long-term yields elevated, tightening financial conditions even without additional hikes. Higher yields increase borrowing costs across the economy, from mortgages and corporate debt to consumer credit, which can eventually slow growth and pressure risk assets.What also makes this cycle unusual is that equities have remained relatively resilient despite the move higher in yields. Normally, rising yields create stronger pressure on stocks, especially tech and growth sectors. But as long as markets believe inflation can eventually cool without a recession, risk appetite may stay supported for now.
RBA minutes from the latest meeting showed that after three rate hikes this year, members could now be ready for some pause after three hikes this year. They may want to wait for more data and also see how the situation in the Middle East develops, so they likely do not want to rush too much with additional hikes for now and may need more time. This is one of the reasons why Aussie is turning lower again, and it’s very possible that the pair is now trading in wave A of a higher degree A B C pullback that we already discussed in yesterday’s webinar. Resistance to watch on rebounds remains around the 0.7180 area -0.72.
GBPAUD remains under pressure within a larger bearish cycle, but technical and fundamental conditions suggest a corrective wave 4 rebound may unfold in the coming weeks.
Dive into today's early market action with the Blue Line Futures Metals Minute! (Episode 661)
Kiwi is reversing quite aggressively to the downside, and notice that price on the 4 hour time frame is currently breaking the trend line support connected from the April lows, so it appears that the three wave recovery is already finished, completed D wave, exactly at our first resistance near the 0.5960 level. The reversal lower that we are tracking now looks like a wave E decline, but we know that wave E should unfold in a minimum of three waves, so it’s very possible that this weakness continues much lower towards the 61.8 percent or even the 78.6 percent retracement levels, located around 0.5750 - 0.58. Those are the next major supports to watch for a potential rebound, but only after we complete a three wave decline from the recent swing highs.
EURCHF may dip toward 0.9100 support within wave C of (Y) before the broader bullish trend resumes.
NZDJPY remains below the 95 resistance zone and could still be forming a wave four correction before another push higher toward 96–97.
