You cannot change your destination overnight, but you can change your direction overnight.
The fiber holding firmed at $1.0856 associated with the upbeat German ZEW expectations released Tuesday and ahead of Thursday's European Union leaders’ virtual-summit expected to deter a final decision on how to finance the bloc’s economic recovery in the aftermath of the COVID-19 pandemic.
The Cable nosedived to a fresh low of $1.2245 before recovering to $1.2320 this morning soured by a gloomy assessment of recovery prospects of Britain's economy from BoE Governor Bailey, combined with the refusal of the UK government to extend Brexit negotiations past the end of the year.
The safe-haven yen idled around 107.58 per dollar as markets struggled to find much upside progress on hopes of a $484 billion interim stimulus plan for small businesses and hospitals in America.
The Aussie got a timely lift from $0.6250 to $0.6318 following Australian's retail sales surged a record 8.2% in March as a coronavirus lockdown sparked panic buying of food and staples, that helped offset risk aversion globally.
The South African rand plummeted to 19.11 against the greenback amid escalating worries about South Africa's fragile fiscal position, with local government announcement of a stimulus package for COVID-19 relief funding.
The pair stayed put at 40.40(selling) on the domestic market.
- From an Elliott Wave standpoint, USDCHF could potentially unfold into compelling impulsive Wave C of the zigzag correction of Wave (2) to a narrowing region 0.9550 (50% retracement of Wave (1)) to 0.9395 (100% projection of Wave A through B) in the near term trend, from the downside bias from April 6th high of 0.9797.
- Price could immediately start to shoot back up into Wave (3) on a longer perspective.
- Piercing above the resistance 0.9905 would endorse the structure.
- Alternatively, broader bearish invalidation of Elliott Wave Structure rest at 0.9191 of March 9th low while Relative Strength Index signals a bullish recoil higher for the pair.
• After rallying to the downside from a high of 112.22 to 101.17 amid global pandemic threat, USD/JPY has been in a correcting mode since 9th March 2020 and seemed to have recently completed an W-X-Y Double Zig-Zag structure of Wave (2) reaching a high of 111.64 on 27th March 2020.
• Two strong indicators were flashing a trend reversal: ending diagonal at Wave 5 of Wave c and bearish RSI divergence.
• On the hourly chart, as per Elliott Wave analysis, the pair might resume its downwards trend targeting 100.64 - 93.78 to unfold Wave (3), a projection of 100%-161.8% of Fibonacci level.
• At 107.70 today, USD/JPY is percolating towards its target from 110.41 to 107.84, as per chart.
• On a side note, resumption of a bullish USD/JPY would mark an invalidation of the Elliott Wave structure above 112.22