I was really quite comfortable with my outlook – until I woke up. Yesterday’s reversal back to the dollar downside has thrown a spanner in the works and that always causes doubts. My monthly/weekly outlook remains the same so it will need an alternative approach. That it also forces a major regrouping makes the process far more complicated when using the daily charts – so much is lost in the lower degree structures. Thus, I am rather on the back foot until I can confirm my tentative adjustments are correct.
What’s more, there’s even a good risk of a recycling in one or two pairs – and probably requires this due to the current position in USD/CHF. That I hit the downside target I had offered precisely – and in GBP/USD also.
When looking at USD/CHF, we also have a potential mediator due to its current position and one that has a unique structure compared with the other Europeans. How it develops today will provide a possible guide to the rest of the move, but overall it looks like a complicated process that could see some pairs stretch limits.
EUR/JPY appears to be in a complicated consolidation. It’s probably best to leave it alone for a while but could eventually also give clues to the next moves in USD/JPY and EUR/USD.
Finally, the Aussie pushed close to the 0.7608 high but baulked at trying to push above.
Overall, while there are some puzzles I tend to favour the dollar upside today.