Dollar Continues To Gain In EUR/USD, USD/CHF

All is progressing extremely well. Of course, there’s always the risk of a deviation from this expectation, rather like the upside shortfall and losses from the 1.3700 high, but at this point the entire spectrum of currency pairs I follow are developing pretty much in line with expectations. If there’s any pair that puzzles, it’s GBP/USD that has feinted one way, then the other, and appears to have fallen over its own feet. This pair I have left to one side until its dizziness has eased.

As for the rest of the pairs, it should be back in the same seat today. I’m seeing further Dollar gains in EUR/USD and USD/CHF as a follow-through to intermediate targets today and no doubt the rest of the sequence should extend into early next week. I can’t even see the usual Asian consolidation today. However, no doubt there’ll be a bit of kerb crawling to set up the rest of the move into Europe and North America.

The Aussie did provide its own surprise early in the day but I was able to catch that just before the report was sent out. From there we have seen a solid decline. Some care is required here because of the rapid nature of the reversal lower. Being 100% certain of the first wave is always difficult in these circumstances. However, we should see another shift lower today.

I was uncertain whether we had seen the corrective high in USD/JPY. If there was uncertainty then it was quickly clarified by the rest of the day. This has broken below the 101.23 low but then corrected higher. There are further losses to come. While 4-hour momentum is building a bullish divergence, hourly momentum has a more mixed signal. The combination of hourly & 4-hour bullish divergences will be a key signal. It should be added that EUR/JPY slipped lower perfectly but I don’t see this as a done deal just yet. There should be further losses to the target areas I have been identifying for the past 2-3 weeks. In saying this, do also be aware of the upside breaks levels. In EUR/JPY there is a very clear alternative but I’d wait until it is confirmed.