Life is what happens when you're making other plans.
The Single currency extended gains above $1.1000 yesterday boosted by reports the EU commission has proposed a revised 750B EUR recovery fund with 500B EUR available in grants and 250B EUR available in loans. However, the proposed plan is far from a done deal with Austria, Denmark, Sweden, and the Netherlands still opposed to such an extensive grant program.
The British Pound fell sharply to a low of $1.2250 on Thursday undermined by prospect of negative interest rates and declining optimism a Brexit deal will be reached before the end of the year.
The Yen dropped to 107.80 per dollar as hope of a quick rebound in economic activities around the world continues to drive direction.
The Aussie slipped off multi-month highs from $0.6680 yesterday to $0.6590 this morning on reports China will begin promoting the use of domestic coal reserves and tightening import rules on shipments coming in from Australia.
The Rand held onto gains to 17.36 against the greenback despite global weakness in emerging market currencies after the U.S. said Hong Kong lost its autonomy from China, further straining the Sino-U.S relationship
The USD/MUR little changed at 40.45(selling) on the domestic market.
16:30 - USD - Core Durable Goods Orders (MoM)(Apr)
16:30 - USD - GDP (QoQ) (Q1)
16:30 - USD - Initial Jobless Claims
18:00 - USD - Pending Home Sales (MoM)(Apr)
19:00 - USD - Crude Oil Inventories
- 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