Global stock market extended losses during Asian hours after poor number in US jobs reported on Friday and continuing sovereign debt concerns. HSI is down more than 2.8%, NIKKEI -1.8% CHINA -1.9% and KOSPI more than 4% in red.

Based on he wave structure shown on S&P500, oil and Treasurys, we believe that risky assets are headed lower in this week. As such, we US dollar should strengthen in this week against the other major currencies.

Usd/Chf intra-day

Usd/Chf formed an extended wave v) within wave (a) about we warned you in the past intra-day update. well, price as we can see recovered quite sharply from 0.7710 so we think that an impulsive decline from the top is complete and that three-wave corrective bounce is underway, which will be a blue wave (b). we will be looking for another sell-off once we will be able to recognize end of a corrective recovery, which may find resistance somewhere around 0.80.

Aud/Usd intra-day

Aussie moved nicely lower from 1.0786 where pair shows evidence of a larger completed corrective recovery. In fact, even a sell-off from the pick appears impulsive, so we believe that this pair is headed even lower. As such, we favor higher US dollar while pair trades below 1.0768.

Forex Analysis by Gregor Horvat at ForexPros. com