Lack Of Commitment ...

Just as I thought there may be a slim chance of dollar gains, it pulled back right at the very brink, and turned its nose up to slip lower. I’ve been working with two basic scenarios, but looking for the structures across the Europeans to coordinate themselves into a more correlated larger structure that would bring them back into alignment. At this point they are not there yet, and to be honest this final outcome does still seem a little way away - I suspect by early next week.

So the bias is dollar bearish for now, and with yesterday’s rebuttal of the upside, the manner in which these three finally come to focus on one direction does seem to be a little clearer. Of course, when dealing with these occasions where complex corrective structures develop, there is a constant need to watch your backs for when the favoured outlook breaks down. This often occurs on a break of a Wave (iv) area, or of a limit for a Wave (x) that would imply the current move has broken down. This is something we need to constantly pay attention to, and today’s no different. However, it would really help for the current direction to follow-through.

The upside limit in the Aussie restricted any attempts to push higher as expected. We’re now in a position where the next break will define a more directional development. At this point, that implies a deeper recycling higher or a plain, simple resumption of losses. Note those break levels.

The JPY pairs remain languishing in the larger consolidation, and pretty much poised in the centre of the range. I tend to prefer the upside but this will need confirmation. If seen, it does have quite good projections within the context of the consolidation, with an outside chance of the EUR/JPY being slightly stronger if both the EUR/USD and USD/JPY decide to form a partnership. Any lack of upside enthusiasm could just as easily allow price to sink back into the consolidation quagmire.

I think understanding the breaks today, specifically in EUR/USD and AUD/USD, will provide the more definable outcomes. The GBP/USD could be added to that list but, again, I’d rather look for confirmation.