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USD
EUR/USD
The Single currency tumbled from Friday's high of $1.1905 to $1.1750 this morning after the euro zone's economy recorded its deepest contraction in Q2 GDP.
GBP/USD
The Pound snapped from a five-month high of $1.3164 to $1.3055 this morning on fears of a no-deal Brexit combined with a broad U.S. dollar strength. Major attention has now shifted to Bank Of England's rate decision on Thursday.
USD/JPY
The Japanese Yen nosedived to 105.90 against the greenback unbothered by upbeat Japan's GDP figures.
AUD/USD
The Aussie dollar slipped to $0.7140 on risk aversion after the state of Victoria set curfew to curb COVID-19.
USD/ZAR
South Africa's rand slumped to 17.15 versus the greenback as investors' hope for a global recovery was dented by a sharp contraction in the U.S. and European economies.
USD/MUR
The pair remained unchanged at 40.25(selling) on the local market.
12:30 - GBP - Manufacturing PMI (Jul)
18:00 - USD - ISM Manufacturing PMI (Jul)
After rallying from bottoming all time low at 101.20 to 111.71 in covid-fueled March period, dwarfing an expanding leading diagonal ((1)) in 5 waves, USD/JPY has ever since unfolded in a corrective double three combination pattern (W)-(X)-(Y) of wave ((2)).
From an Elliott Wave trading standpoint, the pair may experience further decline to the choppy downside to complete countertrend wave (Y) because- An impulse usually retraces to at least wave (4) of previous smaller trend, that is 105.19.
- Wave (4) of wave ((1)) coincides with 61.8% Fibonnacii retracement of wave ((1)), i.e 105.19.
- 78.6% projection wave (W) through (X) targets level 105.30.
- In EW lexicon, a pullback to the previous wave (2) usually happen to a leading diagonal ((1)).
- Post-triangle thrust measurement of wave B of (Y) leads exactly to 105.20.
- USD/JPY is still trading within the bearish parellel trendlines.
Thus, hibernation of price action could be seen in the locality of 105.30/19.On the flipside, a violent recoil to revive bullish momentum at 109.84 of June 4th would nullify this set-up, warning that the potency of positioning-derived bearish signal may be ebbing.
On the hourly Chart, The USD/CAD has found strong support again near $1.3350 region yesterday. The pair fell to as low as $1.3345 before bouncing off relentlessly to as high as $1.3444 this morning.
We feel that the USD/CAD could be in an early stage of a bullish run towards $1.4017 in the coming months.
On the downside, $1.3315 remains a strong baseline , while a break below that level would open the door for further weakness on the USD/CAD near $1.3200.
