The highlight of yesterday’s development was in GBP/USD, whipping higher and then a heavy decline – and that was just a Wave (a). We shall need to be cautious with this pair but overall it’s got all the hallmarks of strong volatility.
Otherwise, EUR/USD should be heading higher, USD/CHF lower while USD/JPY still needs gains. Indeed, USD/JPY has taken a long and winding road to the upside and I can’t expect a sudden rush. Most likely this development could take us over the rest of the week – perhaps into next week.
With EUR/USD looking to the upside – along with USD/JPY – we can expect further gains in EUR/JPY but there is a finite limit. There are also signs of the potential bearish divergences in the cross.
I have had a difficult time with AUD/USD but – I think – I have resolved this. It has a pretty strong hourly bearish divergence and while noting the limit, overall I’m looking for losses to resume.