Across the pairs, we have had a range of reactions. For the most part in the 4 majors we have seen USDJPY, USDCHF and most likely EURUSD, completed the Dollar lows. I’m still a little wary of a new high but it’s basically going to see losses. Therefore, we have only GBPUSD that needs a minor push higher before it turns back lower. What has been quite interesting is the range of development through the three markets. USDCHF has seen quite a solid rally while USDJPY has only managed a mini-minor initial push higher from the 111.83 low. Equally, EURUSD should have seen its high but I’d suggest allowing for a minor new high.
Once we get past the EURUSD/GBPUSD highs we should begin to see a decent reversal lower. Of course, we’re going to need to work through the initial (Dollar) bullish foundation waves before any real solid gains.
The Aussie should still see a follow-through higher to complete the bullish zigzag. Once that has been seen then we’ll have a quorum in terms of Dollar direction.
On a note in EURJPY, the recent lows have been rather rough in terms of ratios – or lack of good ratios. I’m rather wary about this but frankly, we should be seeing a consolidation – of sorts – with USDJPY expected to push higher and EURUSD lower. I’d still suggest waiting to break out of this rather difficult structure.
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