If that reasoning holds then my question is why did the USD sell off strongly on the very day or at the moment tapering was mentioned.
If all participants have read too much in to Tapering and are disappointed, what will be likely impact? Could the USD have held up for too long on hope?
From chart perspective, I think we have potential diamond pattern being develop which could be either a reversal or continuation pattern. Even if the diamond pattern forms or fail to do so, from counts labels on my chart I think we have recently formed very significant top which is also a running flat wave (4) on larger time frame such as weekly or monthly (see Monthly chart below originally identified in September 2012 http://www.screencast.com/t/AwUQ6tdWlqX ). I understand that I could be a lone voice on such view of the USD over next 12-18 months period during which we will continue stair casing down to possibly form new lower low, before final low is formed.
I have checked longer term USDCHF & USDCAD charts to help confirm longer term view. If correct I anticipate a major directional trend to develop soon out of the long side way congestion area.
Anyway, hope it will help you to cross check or refine your own analysis to enable you to be on the right side of the market.