After minor new lows in the dollar, we’re back on track to begin to make a stronger move higher. However, we have come to a point where we should see an early pullback in the Asian centre before any further gains can be seen. This should provide a stronger platform for a dollar rally in the European and U.S. centres. Indeed, I am looking for the first reversal target in USD/JPY that suggests quite a solid rally.
EUR/USD should soon see a Wave v. USD/CHF should see a limited pullback before gains resume while GBP/USD is finely balanced between direct losses – or a new high to complete an expanded flat in a Wave [ii]. Either way, over the day we should be heading higher in the dollar.
The Aussie managed to make a minor new high, rather like the 4 majors, but we have seen the high now and we should be heading lower.
I was rather amazed at the strength in EUR/JPY, with bearish divergences and a rising wedge that should have suggested losses. However, with EUR/USD moving lower and USD/JPY higher we have seen a 3-wave move that could provide a complex correction. This will need some care.