Greetings once again, Everyone!

In The Near-Term, we are seeing “Digestion” in most Currency Units of today’s Macro-Data as The BoE Holds their Overnight Rate and also keeps their Q.E. Program unchanged for now, U.S. Jobless Claims beat Consensus but Continuing Jobless Claims kills that Sentiment, and our “Back-and-Forth” Friend, China, returns to the World with more Rhetoric on Diversification of the World’s Global Currency situation.

The Dollar and The Yen retreat a bit and in my personal View… would have taken place from a Technical  Perspective irregardless of any Macro-Data or Rhetoric in the first place.Currently, we are once-again seeing IntraDay Reversals as U.S. Equities and Indices flatten a bit and lose Momentum… and The Yen returns to pick up a little Strength.

Confused?… Do not be.

One word explains it all!… Consolidation.

As we discussed last night and in many instances in the past, when we see such intense Price Volatility and Momentum, we realize Price cannot operate in this fashion indefinitely.

Just like you and I climbing the mountains, Price needs to “Rest and Reprieve”… have a snack… grab a drink… whatever!

This is still fairly evident across most Units with Bear Flag Patterns on various Time-Cycles…. and now that we have spent some time in the actual “Flag Forming Progress”, we can see these types of Behaviors with more clarity.

Let’s bring in The Queen and Her Cousin, Pound Yen again… since it was BoE Day today… 

Give The Captures a Click, as always, with Commentary above, and Post-Time is right about 15:15 GMT.

The Bear Flag Formation is clearly evident on the Hourly now, as we see the BoE and QE Data providing Impetus for some Pound Strength.  

The Daily Uptrend that we initiated from March is still Valid and “anchoring” Price, as we push through Initial 1.6200 Static Resistance forming a “Transitive Rollover” Area.

Now, “Full Completion” of The Flag will see the 1.5250’s obviously in The Mid-Term… so The Key here will be to see if Price can Clip back through The Flag, and at least Breach the Dynamic Confluence Fib Variant Support @ 1.6085. The Flag will be on Its way again as we then Breach the Daily Lower Uptrend Channel Line.

In this Case for The Pound Yen, we have a more “Subjective” Bear Flag here that is foreshortened, albeit with the same “Function and Behavior”. Full Completion here sees  The 137 Area… surely possible… but Continued Yen Strength in this Sense will assuredly provoke a Response from The Bank of Japan concerning Intervention.

In any event… The Breaching of The Daily Lower Uptrend Channel Line ( also acting as our Flag Top here)  calls for a “Re-Test” of the 146.70’s Lows yesterday in The Immediate-Term…. where then the 146.00 Handle is surely In View.

So let us see how these Patterns fair, and also if we see any sort of Recovery in Sight towards’ Today’s Closes here on these Units… so more Updates to come!

Of course… there is One Caveat moving forward…

As long as Crude Oil continues to get slammed, and adding fuel to The Risk-Aversion Fire… our Two Friends, The Dollar and Yen are not going on Holiday anytime soon.