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The single currency soared to of $1.1017 amid month-end dollar sell-off last Friday before retreating to $1.0940 on Monday as risk sentiment took a hit on rising US-China tensions.
The cable cascaded from $1.2641 to $1.2424 as Brexit and virus updates weighed down the pair, amid market is eyeing for Bank of England interest rate decision this week.
The yen mounted to 106.70 against the greenback on the report from U.S. Secretary of State Mike Pompeo on Sunday that there was "a significant amount of evidence" that the virus emerged from a Chinese laboratory.
The Australian dollar plummeted to $0.6380 on comments from U.S. President Donald Trump on Friday that raising tariffs on China is "certainly an option" as he considers ways to retaliate for the spread of the coronavirus out of Wuhan, China.
The South African felt the pull of gravity to 18.92 per dollar as investors bracing for more bad news after dismal economic releases around the world signalled coming pain for developed and emerging economies.
On the Domestic market, the U.S dollar edged back to 40.30(selling) against the Mauritian rupee after BOM’s intervention to sell USD 8 million to local banks last Thursday.
11.55 - EUR - German Manufacturing PMI (Apr)
- 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