Just an amazing dollar recovery today.  It was fueled by comments from the French Finance Minister indicating that further euro gains will not be tolerated.  Gold was also trading some $26 lower from the intraday high of $711-12 to a closing quote of $691-92 to help out the dollar. There is fresh blood in the streets and further losses are likely on new short interest and stop hunts below 1.2700. Below 1.2700 is a very significant Summer 2005 level of 1.2600 which forms the buy point of a massive Butterfly pattern. This level is critical in our new focus level. 
 

Here's the play for our first shot on the move down to 1.2600. The hourly trend channel shown in the chart above combined with former weekly lows of 1.2770 will serve as our pivot point resistance to initiate shorts for tonight. Stops should be above 1.2800 and the target will be May 10 lows of 1.2680. As always, I encourage you to book profits on a partial position once your current unrealized profit is equal to your total initial risk on the trade and to then trail the stop to breakeven.

USD/JPY is working hard to make a confirmed break from the 4-hour downtrend channel at the 111-111.25 area. If price can pull through the channel, 113.00 is the target.

Let's look to be long dollars here above 110.80 and as high up as 111.00. Stops should be below 110.75 and the target for tonight will be the 112.00. The same risk/reward rule from above applies here.