Having seen some decent dollar gains, we are now close to a reversal. As a broad guide, it initially suggests further dollar gains, potentially some lower degree swings and later a reversal. Therefore, by the end of today (perhaps tomorrow) we’re more likely to be seeing the dollar making a move upside. We’re already beginning to see the early stages of dollar bearish divergences and that suggests that by late Asian/and into the European trading we will likely be developing the follow-through higher in the dollar and then the reversal. As a simpler guide basically this suggests broad swings.
EUR/JPY made some decent losses also. We can begin to look for a pullback higher and later for a reversal. The only possible detour would be through a sideways consolidation considering that EUR/USD and USD/JPY are likely to have similar development – just opposites.
As for the Aussie, most likely it’ll be a bearish day except that there is initial upside risk first.