Well, that didn’t last long. Yes, we saw some limited dollar losses but pretty shallow. The Wave [ii] in EUR/USD was pretty shallow and within that range we had a double zigzag. Equally, USD/CHF took advantage a little earlier to break above 1.0037 and USD/JPY was able to complete a Wave i and while we need confirmation, there’s a good chance that the Wave ii is in place.
Obviously the FOMC managed its normal havoc but appears to have settled. Trying to generate the analysis in the middle of such havoc is always testing but I sense we’ll go back to the same dollar bullish track. Thus, we’re going to need some time to bring back a degree of confidence that should lead the dollar higher once again.
My outlook for GBP/USD failed miserably, but I found the error. This should still see losses and on it’s way lower. Indeed, the drop to 1.2375 in the dying days of March was far too deep to be able to maintain an impulsive rally and we need further losses over today and tomorrow. This should see all the four majors treading that same route but will require foundation waves to develop so the start of the day looks pretty limited for a while.
EUR/JPY had done well on the upside but I feel we need another rally to a new corrective high before the downside can resume. AUD/USD appears to have lost its mojo and we need a more definitive move to pull it out of its major consolidative slump. This is not a pair to really work with at the moment.