The Risk Of Dollar Gains Resuming Appears To Be Getting Stronger
Ian Copsey | Aug 14, 2012 03:55AM ET
I wasn’t too surprised with the way things panned out yesterday although not everything went my way. However, the core development was pretty much in line with what I had thought was needed to adjust the respective currency pairs to set up a stronger foundation for intermediate projections to slot into the larger daily structure. Having said that, there is still a cushion of support under the Dollar that could still be tested before the uptrend finally gets under way.
The push to minor new corrective highs in GBP/USD developed well and this appears to be quite a good indicator right now. Yes, this too has that cushion of Dollar support but seems very limited so I’d suggest watching this for a decent signal. AUD/USD failed to make that same push higher but I don’t find this particularly damaging but do feel this now has a growing risk of losses.
EUR/USD and USD/CHF were both pretty close to forecast.
USD/JPY proved nothing having taken the day off to sleep. It still remains in a slightly ambiguous area, finely balanced between a correction higher and a resumption of losses. It’s quite possible that EUR/JPY will provide the catalyst for once this resumes its downtrend it could quite easily drag USD/JPY down with it. Still care required with USD/JPY then, while EUR/JPY is pretty much at the mercy of EUR/USD… When that begins to move then the cross should dutifully follow.
Thus, we’ll probably see the usual quiet start to the day. Focus should be on the whether we see minor new Dollar corrective lows or direct resumption of gains… Bide your time and spot the breaks…
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