The market really made a meal of the dollar losses yesterday. We may even see a minor follow through but it’s more or less there. With the U.S. bank holiday on Monday, we should see some squaring of positions and that will likely conveniently provide the reversal lower. However, as I mentioned yesterday, we shall next have to navigate the Waves -i- and Wave -ii- to provide the platform for a stronger move. Therefore, we’ll probably have to be patient to allow these waves to develop.
More interesting was the depth of the pullback in EUR/USD… That’s going to need a healthy move…
I still feel that USD/JPY and GBP/USD need a minor new dollar low before a reversal but that shouldn’t take too long. USD/CHF could also be the same. There was always a duality - as I provided an alternative outcome – and therefore take care today. I’m in two minds about EUR/USD but even if it makes a new high there’s still some room.
The balance between EUR/USD and USD/JPY provided a flat day in EUR/JPY. I get the sense that we should see USD/JPY make the cross move higher before EUR/USD begins to reverse…
Has AUD/USD found a final high? We’ve seen a double zigzag. Could there be a triple three? These issues are always difficult to judge – so take care.