We took a tight stop in the Australian dollar last night, but the pattern calling for a push lower in wave 3 of the larger 5th still remains valid. So until the pattern proves otherwise, we will continue looking for a stronger US dollar against the Australian dollar. I am short currently at an 0.8230 average with 0.8265 stop losses in anticipation of the trendline break. At 0.8220, and once the trendline I broken, I will stop in for more and trail the stops to 0.8240.

It was a generally quiet New York session that had the feel all day that something big was about to happen, but nothing really materialized. I managed to make small profits in the Aussie by scalping around our core view that prices are headed lower, but a strong EUR/USD and AUD/JPY prevented this from becoming a reality. For now, I prefer to step back and wait for more price data before making the next move.

USD/JPY had interesting push down towards the figure just now to retest the 116.05-area New York lows, but was not able to scoop any down there. I am a bit hesitant tonight because of New York's generally choppy price action tonight, so as mentioned this morning, I prefer to wait for 116.40 trendline break before getting involved.

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Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

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