We have finally settled the highs in USD/JPY and USD/CHF and also the low in EUR/USD. Now we need to establish the depth of the corrections – and that’s the difficult part. So far, EUR/USD has been the most obliging of the other two and seems to be relatively close to completing a double zigzag. From what I can see, USD/JPY and USD/CHF appear to need a second decline. Thus, to a degree, we seem to have a basic level of correlation and it’ll be best to watch for USD/JPY and USD/CHF because they have a firmer outlook. Ideally, it will be convenient if they all stall around the same timeframe – but let’s see…
Now, GBP/USD has seen a zigzag higher – but frankly needs losses. There’s barely any room above. Whether this will be direct with a break below yesterday’s low, or form a complex correction – flat or expanded flat.
AUD/USD dipped a little further but should now see gains – probably helped by the dollar bearish outlooks in JPY, CHF and EUR. However, it’s still in a foetal position that has little to show in terms of structure. Hopefully, during the day, we should begin to see some logic to the development.
As for EUR/JPY, we have seen some losses followed by a pullback. Thus, how USD/JPY and, maybe a slower EUR/USD, I suspect we’ll see the cross dragged lower.
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