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The bullish Dollar outlook was correct but the extent of yesterday’s gains exceeded my expectations on the day and instead has taken us closer to what I feel will soon be a slightly stronger correction. The strength of the rally has basically highlighted what I feel is the hazard in this market – that projections are not really holding as precisely as before. The low I was expecting at 1.4585 apparently ended at the 1.4585 low and thus yesterday’s follow-through is therefore implied as a final leg of an intermediate decline…
Given that projections are not holding that well I can only highlight what should happen – and that’s a final Dollar rally to 1.4433-63 EURUSD and 1.0452-55 USDCHF and hope these occur. The barrier in the way for EURUSD is the 1.4480 swing low. However, there are Dollar bearish divergences building up in the 4-hour charts so today’s anticipate gains should not be excessive…
It is interesting to see what appears to be a big unwinding in GBP-EUR/CHF positions with GBPUSD remaining stubbornly in its range. I am beginning to more strongly doubt the triangle scenario and feel that as long as it remains above 1.6166-97 that we’re more likely to see a rather sharp rally along with the final reversal in EURUSD & USDCHF… and I wouldn’t be too surprised to see this as high as the 1.65 area…
That should have an impact on GBPJPY but quite how much will also depend on USDJPY. The latter also rallied strongly and if I have any preference then it is for a retest of 90.77 again but then a total reversal. That could actually take the cross quite a bit higher also. If it surpasses 146.41-70 then the 148.47 area becomes possible…
So it seems as if we shall see some decent movement again today (unless the current correction slows to snail pace) but following this we do seem to face a 1-3 days of corrective price action again.
Today’s free analysis is for GBPJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+45 pips with open trade) and the new review of the support & resistance levels issued in the daily report and FX-forecaster Trader Package.
Good luck
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
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Well yesterday turned out mostly not much like how I had envisioned. I still retain a broad Dollar bullishness and this is where the risk lies but yesterday was a clear indication that the market movers really want to shut up shop and avoid any threat to their profits… The sharp reactions early in the day were no doubt met with disarray but the status quo resumed thereafter.
Ideally I’d like the Dollar to drift higher (or possibly rush to feel the wind in its hair – briefly) towards the sort of initial targets I highlighted yesterday – at 1.4554 EURUSD and 1.0384 USDCHF – and then pull back. If it doesn’t do this then the risk is that we’ll either see the tedious range trading continue or a deeper pullback but I wouldn’t expect much further than yesterday’s corrective lows.
On GBPUSD – just watch out – a move above 1.6325 could generate a mad moment of gains or perhaps I expect too much and it’ll slowly drift. However, the break should, one way or another, risk follow-through to 1.6423-43 at least and I wouldn’t mind betting on the 1.6500-10 area…
Elsewhere USDJPY has been exceptionally subdued. I again hold a bullish preference and that’s the way I’d prefer it to move but the only thing that keeps nagging in my mind is continued range trading possibly with mild slippage to 86.80-09 before the next push higher.
The JPY crosses look stagnant too – but again I feel with a mild bullish bias. So if there is any room for holding a position then I feel the upside would probably be the better option.
However, overall these markets are really ones where you take profit when seen and offer thanks. It matters not that more pips could be reaped as these markets hold greater risk that normal for erratic behavior.
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 (+20 pips with open trade) and the new review of the support & resistance levels issued in the daily report and FX-forecaster Trader Package.
Good luck
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
Friday settled a big question. The Dollar looks like following a more direct route to its bullish retracement targets and these could be seen as soon as next week. From what I can see the cycles are Dollar bullish across the board so it’s more now down to identifying the stalling points as it shouldn’t be a direct rally with a couple more corrections in between.
Having said that today should still see follow-through but the bulk of the rapid move is over with now and from this point there is greater risk of more complex corrections but overall maintain the rally through to 1.4460-80 EURUSD and 1.0452 USDCHF. These areas should provide the next intermediate top so expect a pullback from there.
GBPUSD is less obvious and I feel a little more care needs to be applied to this pair. Overall I am bearish but there are a couple of spanners that could suddenly arrive in the works. I wouldn’t been too surprised to see a bit of a pullback first before the next leg lower – but take this as it comes.
USDJPY has broken higher again also and looks quite positive. I have some mixed views over how quickly this can extend higher and with the JPY crosses having been somewhat volatile the balance of the weakness expected in the European currencies versus a bullish USDJPY raises the risk of some pretty erratic moves…
Let’s just say this is my favored view and if there is any risk then it’ll come from more consolidation rather than excessive weakness.
As we go through the week remember that market liquidity will be on the decline and this normally translates into rather erratic behavior. Therefore keep your trades simple and ensure set ups are robust. I have already detected that normal projections and ratios are weakening slightly and may well prove to continue…
Today’s free analysis is for USDCAD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (+ 140 pips) and the new review of the support & resistance levels issued in the daily report and FX-forecaster Trader Package.
Have a profitable week
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
The question still remains… have we seen the Dollar peak against the Europeans or are there further losses to go? It’s was USDCHF once again that pushed the limits again and even forced a new high but not one with which we can get carried away.
To be honest there are conflicting signals. We have Dollar bearish divergences in the 4-hour charts but the Dollar has hardly taken advantage to push support levels aggressively. On the other side what concerns me is that the longer this consolidation extends any break higher in the Dollar would actually threaten to break through the resistance targets I have been highlighting. If that happens then we’ll see more direct gains as the long term retracement targets still have room for 300-400 points…
USDJPY does seem to be attempting to break out of its range however, and well it must as the hourly bullish divergence has seen my RSI move into an overbought extreme so unless it extends the rally quickly then the risk may well still be lower. Perhaps the JPY crosses will provide a clue – though there has been no catalyst here either.
However, I do feel a break must come soon – one way or the other – as just about everywhere there appears to be a decision to be made. This is even true in USDCAD which performed perfectly yesterday in the decline to 1.0478 but so far the recovery has been limp to say the least.
What appears to be the overriding pattern across all currency pairs is that we’ll see a break soon and when it comes it should be quite solid so really now it down to noting where the break levels lie…
Today’s free analysis is for USDCHF and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (open trade) and the new review of the support & resistance levels issued in the daily report.
Have a great weekend
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
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That was quite a strange day and what I have seen doesn’t really confirm much at all. So much of what occurred yesterday could still be seen as a corrective structure and these tend to whip back and bite one’s “derriere” so I feel we still need treat this with plenty of care.
That should definitely be the guiding word for the next 2-3 weeks frankly as I still feel that the major risk is for 5-10 days of consolidation. The only question that remains in my mind is whether we can still see one more push to 1.4630 EURUSD and 1.0325 USDCHF. Certainly, the overall evidence of a reversal back lower does seem to be coming together and probably more so in GBPUSD.
Even the JPY crosses are beginning to show signs of reversal and AUDJPY looks to have confirmed that already even if it’s AUDUSD that has dragged that higher. However, USDJPY has been dabbling with some fairly key support levels and any move above 88.45-69 would appear to set it on the bullish road once again.
I often find that AUDUSD leads the pack and it looks like this will be the case and if so then 0.9244-64 looks to be the target area but this is probably still within a sideways consolidation. But then we’re back to my expectation of a rather erratic and messy week or two. It seems unlikely that the market is about to launch itself into a trend, increasing exposures ahead of the New Year…
Take care today.
Today’s free analysis is for USDJPY 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 luck
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
The analysis yesterday was pretty tough and now I’ve had the benefit of hindsight the structure had developed complications which were far too complex to forecast with any accuracy. However, the end result does fit in quite nicely with the expected targets for this first rally in the Dollar and there should only be a little more to go in EURUSD and USDCHF before we get a correction to the entire rally from the Dollar’s lows.
Now given that we only have one week of trading with decent liquidity after which it will fade away dramatically the outlook does seem pretty choppy. This is quite characteristic of this time of year but the 1-2 weeks into the final week of the month should be enough for a complex correction to wreak its havoc before we begin to see Dollar strength again around the turn of the year, probably just before. Thus, as we move forward please take care.
The other move of note has to be the continued losses in USDJPY and the crosses. There does seem to be further to go for them all and my feeling now is that this trading range is now probably with us for several weeks. That tends to match well with the overall expectation of another move higher in USDJPY once this correction is over and probably in line with Dollar-Europe.
However, if there is anywhere that we can expect a slightly more extended move then it is in this JPY group. I suspect we’ll get a correction higher in them all over the first part of the day but look for extension of the downtrends by the second half. By tomorrow or Friday we should have found the final lows (most likely tomorrow) and then the direction should be back higher into range.
Today’s free analysis is for EURUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+90 pips) and the new review of the support & resistance levels issued in the daily report.
Good luck
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
Well, what developed was partly expected and partly not. We did see the Dollar follow-through to a marginal new high but without reaching targets and the pullback has been very deep… In fact through most the currencies the picture has turned to one of ambiguity… If I have any preference it is for the Dollar to do the same as yesterday or at the very least move into a sideways consolidation before making that rally.
However, today looks more like a day to be reactive rather than proactive as the momentum picture has also turned to more reflect potential for some choppy range trading. Indeed, this morning is the first time I’ve looked at the price development overall and been struck by the possibility that we have entered the end year twilight zone which all too often generates some rather erratic moves and a reduction in adherence to normal Fibonacci & harmonic ratios…
We should also remember the statement I made yesterday – that there’s not much more in this on the Dollar’s upside anyway and this may well imply a period of consolidation. I certainly can’t envisage new Dollar lows as this stage and if anything the larger positional risk is Dollar short and this would have more tendency towards position squaring as we approach New Year.
Therefore do take care today – and probably for the rest of the month. Be aware of break levels but also remember that even once broken the pullbacks can be similarly choppy too.
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 (+55 pips) and the new review of the support & resistance levels issued in the daily report.
Good luck
Ian Copsey
NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users
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