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So far so good, though the route has not been 100% what I had anticipated but given the ambiguity earlier in the structures it has been close enough. I feel that yesterday’s moves look closer to being a complex correction and this should imply that we’re moving directly to target…
At these early stages when there really isn’t any price confirmation it is prudent to approach this carefully just in case an alternate structure develops but overall I still feel that in EURUSD there is little risk of loss below 1.4916 before the final rally.
A bigger surprise came from GBPUSD which suffered a sizeable drop. This does bring an aura of completion to the rally and even while EURUSD should rally to target I can’t now see GBPUSD matching that feat. I’m more tempted to suggest that we could be seeing a dead cat bounce. Given the expectation of Dollar weakness in general I feel it may well be better to hold off from any substantial position here until the Dollar lows are seen just to see how GBPUSD develops. For now I feel that the stronger indications are in the other two Europeans.
USDJPY also dipped below 89.61 but hasn’t yet broken below the 89.18 low… It hasn’t been particularly forceful about the recovery and therefore the larger downside risk remains. Make no mistake... If this makes another break lower through 89.18 and 88.60-70 the outlook is very, very bearish. The only hope it has now of generating enough momentum to force a stronger push higher is a break above the 90.25 and 90.84 swing highs…
The position is compounded by the repeated lack of power in the crosses to push above the recent highs – with perhaps the exception of AUDJPY but this is being driven more by AUDUSD… The structures in both EURJPY and GBPJPY have become exceptionally complex and really it will be best to wait for a stronger break to bring clarity. However, the clouds are grey here too and it won’t take too much to see these take a tumble also…
The next barrier for AUDUSD in its renewed life is around the 0.9402 area with final potential to 0.9483-0.9513 minimum and an outside chance if it becomes more aggressive at 0.9662… However, a high is expected here as well…
Today’s free analysis is for USDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Tuesday’s trade set ups (+0 pips) and the new review of the support & resistance levels issued in the daily report.
Good luckIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
With tomorrow being Veterans Day Holiday in the U.S. the next report will be on Thursday
There was no way the Dollar could spend yet another day wondering what to do… The break lower is in line with the preference I always had – not that I didn’t begin to doubt on several occasions – and now generates targets at 1.5200-06 EURUSD and around 0.9917-32 USDCHF. Of course, this is unlikely to be a straight line and at some point I anticipate a fairly sizeable correction and probably starting later today or tomorrow.
Actually, today should start with a correction also but I don’t think this is going to be too deep. Just considering EURUSD we have a “choice” of two areas. The one I am looking at is around 1.4951 and if this holds then we can probably expect a rally to 1.5061-69 only and then the larger pullback. If today’s pullback becomes deeper – to around 1.4906-26 then I’d have to consider the risk that this is the larger pullback occurring sooner. If so then the next rally should end up at the 1.52 target.
That really highlights the potential routes to target so be aware of these and how to take advantage… For the moment I’m sticking with a 1.4951 base and 1.5069 target.
One currency to watch carefully today is USDJPY. This hardly set the world on fire with the rally to 90.25… It is struggling and really needs to pick up some confidence to push above 90.25 to avoid what could be a sharp and nasty drop into the void. In terms of the larger picture I have always preferred a second move higher and if it can manage a push above 90.25 then I’ll be looking out for 90.84 initially and potentially 91.61. This would imply a minimum upside target at 92.89.
It’s a break below 89.61 that now concerns. If this occurs then don’t be surprised to see a sharp drop to 88.00 again. It should cause a pullback but then the next target is down around the 86.93-87.10 area. However, while it can cause a correction the larger implication is actually much lower – at 85.73 and 84.39. I still prefer the upside but it’s worth noting the implication of the alternative if I am proven wrong…
Today’s free analysis is for EURUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (+155 pips) and the new review of the support & resistance levels issued in the daily report.
Good luckIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pmFor MT4 users
Even with the U.S. Non Farm Payrolls number the Dollar still failed to break the tight ranges seen against the Euro and Swiss Franc while volatility continued against the British Pound. How long can this status quo remain? How long can the rabbit stand in the road and not get hit…?
I’m pretty confident that today will see an extension one way or the other. When I first looked at the charts before today’s open I began to shift away from the Dollar bearish side to the bullish. However, the initial losses seen in the Dollar, while not actually making that final break it brings back the potential for continued range trading for at least the first part of the day.
Overall, it looks like a break of the 1.4808-1.4916 EURUSD and 1.0125-1.0202 ranges will most likely seal the direction and with GBPUSD pressing towards the 1.6692 high my underlying Dollar bearish preference may well come to fruition. Let’s see just how they go, but in the larger picture this still should not extend much beyond the recent lows at 1.0032 USDCHF and 1.5061 EURUSD…
The drop in USDJPY was pretty firm and I had indicated on Friday that this may well mean the end of the end. Having looked again I fear that I may have failed to recognize one alternative. The low at 89.61 was almost an exact wave equality target of the prior decline from 91.26 and that means we should also consider the possibility that all we’ve seen is a deeper correction. However, if Friday’s low breaks followed by the 89.18 low it won’t look at all healthy…
Given the bounce in the JPY crosses it looks as if we shall see USDJPY rally and potentially along with EURUSD since any break above last week’s highs is going to look pretty bullish – and more than I had considered before. It really looks as if we’re going to have to watch the entire combination of straight Dollar-currency pairs along with these crosses.
Today’s free analysis is for AUDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (+30 pips) and the new review of the support & resistance levels issued in the daily report.
Have a profitable weekIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pmFor MT4 users
The status quo remains. This state of balance between the bullish and bearish scenarios remains with limited movement yesterday more reflective of the market collective indecision as it stands like a rabbit staring into headlights both in front of him and behind…
If there was any swaying towards the bearish side then it was ever so slight as EURUSD managed to extend its rally by a very unpersuasive 9 pips although GBP proudly tried to out-do its Euro-zone compatriots by extending gains to the 1.6633 resistance.
So we’re left in the middle and pretty much with the same break levels as outlined yesterday. The downside still attracts me slightly more due to the desire to have a Dollar bullish reversal confirmed more thoroughly than it did on the last dip to 1.5061 EURUSD and 1.0032 USDCHF. The only thing I find slightly bothersome about that is it would appear to imply that GBPUSD must break above 1.6738 and I didn’t really have that in mind. Of course, this assumes that it won’t go walkabouts all by itself again. However, while momentum is beginning to lull into consolidation mode, basically it does look more biased towards the Dollar bearish side.
Maybe the JPY crosses hold some clues as these certainly don’t have the look of making a high at the moment. It is possible this is driven by a strong USDJPY but if both EURUSD rallies along with USDJPY the implication is quite obvious. Although it’s not a certain link I feel it will be worth watching the crosses for any idea of what will break and when.
For USDJPY itself, well, upward progress is upward progress and until that stalls it dies seem to be the dominant short term direction and I can’t see any obvious signs of reversal from momentum indicators yet. It may be limited by 91.35-55 today but even that is positive in the overall scheme of things and tentatively this would make it quite bullish for a minimum test of 82.89.
Today’s free analysis is for AUDUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+75 pips) and the new review of the support & resistance levels issued in the daily report.
Have a great weekendIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pmFor MT4 users
It’s amazing how sometimes when there is a decision to be made between bullish & bearish the market appears to have a collective mind … but avoids the decision for as long as it can. We have had a pretty deep recovery in the Dollar, very close to confirming a larger reversal higher but not quite enough to tip the odds in favour of continued strength. Equally, I recognized the risk of the moves which we saw in the European currencies... and just a little more than I had though … but not quite enough to push the Dollar back over the bearish cliff.
This does happen quite frequently in many time frames and it’s just a bit frustrating not being able to state with any total confidence what will happen next. However, the benefit of these instances is that we have some fairly good levels that confirm - or deny – both bullish and bearish structures.
If I have any preference it is still for Dollar losses merely from the perspective that it failed to really provide any technical evidence of completion and reversal in the downtrend. What’s more it didn’t reach targets. However, there is no rule that dictates that it should. It just so happens that probably 9 times out of 10 it does do this.
So I’ll hang my hat ever so cautiously on the bearish hook but knowingly looking over my shoulder at the alternative. If you are talking risk and reward then the Dollar bullish side has far more to go – possibly to 1.40-1.42 EURUSD while the downside target lies at a relatively closer 1.52 EURUSD.
So bear this in mind as we start the day and be aware of the break levels I’ll outline in the analysis.
Elsewhere, USDJPY had a positive day and I’m happy with the call. Directionally it seems headed higher but I do find the structure of the rally less than convincing. Therefore we still need to take care…
Today’s free analysis is for EURJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+0 pips) and the new review of the support & resistance levels issued in the daily report.
Good luckIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pmFor MT4 users
I was right when I stated that the market wasn’t ready to commit to the Dollar downside. The gains seen yesterday took it another step towards a more sustainable correction but the Dollar hasn’t quite yet undeniably made a break higher. Actually, if anything in terms of where I have felt the major lows should have developed, yesterday’s moves have provided a structure that actually fits those targets quite well.
If I have felt any strong conviction to anything this morning it is that we should see extension of the losses from yesterday’s highs back to the recent corrective lows at 1.4857 EURUSD and 1.0155 USDCHF. Indeed, considering GBPUSD hardly blinked an eyelid and remained above its own lows it does seem to support this.
However, there is no denying that there is considerable underlying support now for the Dollar and if we are to see extension of the downside to new lows we’re going to have to press through those corrective lows over the next day or two to raise that scenario again. Until that point I feel we’re going to have to take the first step as it comes.
USDJPY, almost uncharacteristically, decided not to develop in perfect negative correlation with Dollar-Europe… This too is poised between the upside and downside. The fact that it pulled back lower is perhaps tips it in favour of the upside but we’re going to have to still use caution until this finally confirms its intentions.
I have a mild preference for the upside in the JPY crosses as well, and that would tend to point to a firm EURUSD and possibly USDJPY also. Still, there has been some disconnection between various pairs recently which have confused the larger picture so the story remains one of caution.
Today’s free analysis is for USDCAD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+40 pips) and the new review of the support & resistance levels issued in the daily report.
Good luckIan Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pmFor MT4 users
The Dollar did press lower against the Europeans and stalled just short of the lows seen last Thursday. However, the correction from there has been rather deep and this perhaps implies that the market is not yet willing to commit to a lower Dollar at this point. This also seems to be mirrored in USDJPY which recovered but failed to penetrate the 90.48-80 resistance.
The implication as far as I can see is for continued consolidation today but I don’t think it will last beyond tomorrow. It of course raises the unwanted result that dual wave counts are therefore being generated which is quite normal at these stages and itself is a reflection of uncertainty by the market.
Thus today should be a day to play the ranges and be aware of where support & resistance should develop. If I look at the JPY crosses they do still seem to have a general bullish outlook for the day, although within the boundaries of a possible correction. This is a situation to watch carefully since if I have any real concerns it is about the Yen.
Failure to break above the 92.52 high keeps the swing highs declining so a drop below 88.00 is going to look pretty bearish and by this I mean 86.35 at least and I wouldn’t then be surprised to see 84.39. I have always felt it was a little too early to break lower since we still have over 2 years of bearish monthly cycles. Therefore, this is still a tentative outlook but one to keep in the back of your mind.
So then we have to see how the Dollar manages against the Europeans too. Just to repeat, my preference is for one more decline but I wouldn’t want to fight against a rally that pushes above 1.0312-58 USDCHF or below 1.4671-82 EURUSD… GBPUSD is also mapping out what appears to be a triangle and we have to see which way this breaks.
Thus, in summary for today, basically take profit when seen when within the consolidation range. Only look for a stronger move on the break of the extremes of the range.
Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+0 pips) and the new review of the support & resistance levels issued in the daily report.
NEW!! FX-forecaster Trader Package now available at €20.00 pm
Good luckIan Copsey
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