It has been interesting watching the trending pairs – USD/JPY and GBP/USD – while the other 4 pairs that I follow have been working there way through a wide and puzzling consolidation. What can you say about consolidations? Well, they can be damn tricky and can take liberties in terms of the different types of triangles, expansions and irregular expansions/triangles. So there has been a need for a lot of flexibility and patience along with the need to not take a directional bias until the puzzle is finally solved. And as they say, “it ain’t over till it’s over”
In EUR/USD and USD/CHF it’s probably down to two alternatives. AUD/USD is scrambling around picking up pieces of clutter, throwing them away and then hearing funny voices in it’s head. It’s basically has done enough on the downside, but could extend a bit more. Therefore, we’re waiting for the next break level.
Somehow, I sense there will be a need for dollar losses at some point, but AUD/USD can do it’s own thing, or even allow the voices in its head to do something else.
As for USD/JPY and GBP/USD, we’re seeing a more trending development and there’s still more to go. At some point we’ll begin to see the EUR/USD, USD/CHF and AUD/USD come together, but that’s a tale to be told at a later day.
As for EUR/JPY, well much depends on when EUR/USD breaks out of its consolidation.