Wednesday, January 31, 2018

SLOW BUT STEADY

I had hoped for a more direct move higher in the Dollar yesterday. Perhaps that was naive considering the market has been used to sudden jerks lower in the Dollar. That’s exactly what occurred yesterday in EURUSD and GBPUSD in particular. So with yesterday’s deep-ish pullback, we should see a repeat of yesterday – further losses in EURUSD and GBPUSD.

Meanwhile, the other two majors twiddled their thumbs, looked around in a daze and basically succumbed to an expanded flat lower in USDJPY and a deeper pullback in USDCHF. Hopefully, now they’ll begin to see more constructive Dollar gains…

The Aussie managed to complete a deeper pullback. Thus, now we should see a move back higher but not in a huge way. Down in the southern hemisphere, it's summer so they’re probably sleeping a lot. (That’s the polar opposite of Tokyo which has been experiencing the coldest winter since I’ve been here…)

Finally, the cross – EURJPY – the fine balance between an expanded flat and a decline ended up as a correction and that tends to suggest losses. Having written that, I doubt it will be too robust because we have a bearish EURUSD and bullish USDJPY. It could be a limited range day…

Good trading
Ian Copsey  







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