The GBP & EUR are still tussling to give up any gains and there is still potential for the EUR to make more headway before a correction of some sort. Bearing in mind the risk pairs correction, and the large developing in the USDJPY , I suspect we are finally at levels for $ strength to materialise across multiple pairs; therefore, an inevitable strengthening of the $ dollar is surely upon us, even if it proves slight.
Current reasons for long play on the USDCHF pair:
1) Swiss Bank(CHF seller) buyer on Friday, possibly looking to sustain buying strength in the coming week and will materialise more violent strength on better US data.
2) Large H2/H4 complet(ed/ing) in the USDJPY pair. 200 D has held price above it.
3) Serious lows across a lot of the CHF pairs, this will not be favoured by the SNB and they may be considering hidden intervention to stall declines before they get too aggressive.
4) C point confluence of two potential patterns at key fib. levels.
5) $ weakness has been extreme, especially considering that majors have been advancing since July. EUR & GBP are now at neutral pre-taper levels. More gains will be based on sustained effort and improving fundamentals across each pair(notably so in the GBP, not so much in the EUR). We will likely require Fed confirmation of their stance to determine the next 4/5 hundred pip move.
6) Expectation of EU rhetoric to try and pressure the EUR, mainly from Draghi.
7) Double on the daily TF. H4 Marubuzo on EUR with 2 candles to make up 0.786 of the candle with topside wicks on the candles' close. 0.618 tagged on the entire weekly decline from 1.4940 to 1.2042
Entries: 8920 & 8900
Targets: 9000 first, then reassess based on recovery fundamentals and market positioning into the next debt ceiling meeting.
Ultimate target is located at 9620 with 9350 as first serious extended target.