I was looking for a pullback lower in the dollar – although would have preferred a minor new high first. Clearly that didn’t happen, but then things began to get weird. The outcome, I feel, will be a limited correction and followed by the resumption of the dollar’s rally from the Trump low. The only risk is that the dollar rally has been pretty direct and these types of development can provide some illusions due to the limited pullbacks as trend develops. Certainly, this dollar rally appears to be providing an impulsive development and I feel I have caught this reasonably well – at least until the final stages.
The second problem to raise its head was in GBP/USD that pulled back higher – far more than I expected that required a long session just to sort out the structure. Traditional Elliott Wave is a lot easier – just plonk a number or letter next to a swing high or swing low because it looks about right. However, in this Harmonic version, I have to ensure that the ratio structure is adhered to – and that makes it a lot more complex.
The surprising outcome was that I feel we have already seen the Wave [a]… That actually helps us out, to a degree, but we now need to work through this along with the other two Europeans. On a broad vision, this change in GBP/USD still tends to work with EUR/USD and USD/CHF.
Then came a complication in USD/JPY that has a dual outcome. It could break lower for a correction or there is an argument for it to resume gains. Trying to use EUR/JPY is not really of much use because the structure has been so slow and noisy that there is a strong risk of errors – and in general there is a fairly consistent correlation between the intrinsic pairs. Thus, we’re going to have to work with breaks.
Finally, the Aussie has slowed down and could remain a bit choppy but the general momentum has slowed considerably.