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HARMONIC ELLIOTT WAVE

Wednesday, December 23, 2009

As long as yesterday’s highs remain intact we’re more likely to see range trading today

Please note that this is the last report for the year and will return
on the first trading day of 2010 on 4th January.


The Dollar managed to break its high against the Euro to reach 1.4217. It wasn’t quite where I expected but the failure for USDCHF to push to new highs is a warning that today could see a slow grind lower but to remain in the last few day’s range. I guess it should hardly come as a surprise since this is effectively the last trading day of the year. While there will still be services over the 24th the interest in taking positions in rapidly swindling liquidity is not conducive to position taking when there may not be a good enough market to exit that risk.

If I’m wrong and EURUSD pushes below 1.4217 and USDCHF above 1.0506 then we could see a sharp spike high in the Dollar as traders play pass the parcel only the game is to not hold the parcel when the music stops…

I shall concentrate here on a few comments for next week’s trading which, assuming we get the range trading today, should see the Dollar continue its move higher directly. There is one target area at 1.4123 EURUSD and in USDCHF at 1.0548-74. If these break then look for 1.4014 EURUSD and 1.0667 USDCHF… GBPUSD also looks soft.

On USDJPY, the break above 91.69-74 indicates the next stalling area at 92.32-69. Actually, this could be seen today but once seen the risk is then for a correction lower. Thus the JPY crosses would see some strength also.

AUDUSD looks soft while USDCAD remains in its sideways trading range and doesn’t look to break out for some time yet…

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 (- 17 pips with open trade) and the new review of the support & resistance levels issued in the daily report and FX-forecaster Trader Package.

May I extend my very best wishes for a Merry Christmas and a healthy, peaceful and profitable 2010

Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 userscenter

Tuesday, December 22, 2009

Liquidity is low and if the Dollar highs are broken there is risk of significant follow-through…

Please note that The Daily Forecaster will take a break from 24th December
and will return on the first trading day of the year on 4th January.


That was a pretty messy day... The real risk is still the decreasing market liquidity. Yesterday’s price action demonstrates that through the swings that saw little in the way of corrections and keeping to relatively tight ranges but with a general lack of will to push the limits that would take the Dollar more strongly in one or other directions.

Perhaps USDJPY was the exception and moved in line with my expectations and I still feel there is a little more to go before the next pullback. That can’t be much of a surprise at this stage with just today & tomorrow providing any semblance of normality. Thursday will no doubt see half days in many centers and more willingness to stretch lunch hours and do the last minute shopping…

Certainly the market doesn’t seem to have an appetite for short Dollar positions and as we approach last week’s highs there is risk we could see follow-through. I’m not sure how much we can trust momentum indicators at this point as it’s not really a “normal” market. However, the general pattern of things at this time of year is either to settle into comfortable tight ranges… or we see a steady trend in one direction.

If the highs are breached I can point to resistance levels at 1.4230 EURUSD, then way lower at 1.4123 and if this becomes a stretched move then at 1.4014. This would probably equate to moves to 1.0548-52 USDCHF and on the larger target then 1.0667-74…

As a guideline the JPY crosses look a tad on the soft side but could still see minor gains before a bout of weakness. It reflects a firmer USDJPY which I still see reaching 91.69-74 and then much depends on whether we see breaks of Dollar resistance levels against the Europeans.

The Aussie still appears to have a little way to go on the downside while USDCAD appears to have moved back into range so will remain locked in rather erratic and messy trading conditions.

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 (+35 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

Monday, December 21, 2009

I can’t totally rule out one more attempt higher but I do feel that a modest correction should develop …

That early volatility on Friday morning made it tough to provide decent support & resistance as the structure was changing pretty quickly while I was writing the report. Overall I do feel that we should now see a day or two of consolidation but a return to Friday’s Dollar highs should occur – and probably later this week.

The slight doubt I have in my mind is drawn from the fact that the 5 minute FX-f RSI didn’t provide any obvious signs of reversal although hourly charts are showing Dollar bearish divergences. However, we really can’t see any deeper pullback that that seen already or it will tips the scales more firmly towards the correction. If anything I do feel that it is time for a correction.

Already I have found that projections are becoming less accurate, corrections very shallow – or very deep which is causing some confusion over whether intermediate waves have completed. There is no way it will get better this week which effectively only has 3 days of near-normal trading. This means we should remain cautious on trades and make sure that set ups are followed.

One picture I do see that appears to be stronger is that in USDJPY. It must remain above 90.06-20 but the upside prospects are good for 91.69-74 over today – max tomorrow – but then expect a pullback before following through next week.

In turn this should maintain the firmness of the JPY crosses all of which have bullish biases…

Take care with trades… take profits early.

Today’s free analysis is for USDJPY and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (-30 pips with open trade) 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

Friday, December 18, 2009

The Dollar has completed the rally yet but this morning’s craziness could generate a sideways consolidation

In the end it happened again… I called the Dollar lows to look for a pullback from some higher targets … but we’ve seen an extension beyond. What’s more I can’t see an end to this move as yet. I did mention yesterday that in general I feel the Dollar has room to rally into next week … maybe into the last few days of the year… so the overall outlook remains the same.

However, this morning’s shenanigans may have beaten the wind out of the market and the strong risk is that the market will want to let the week lay down and die. Especially in the JPY pairs we appear to have seen spike bottoms and this opens up a few alternatives and one of them being more bullish for USDJPY. However, even then I feel that a quieter day should be seen.

One pair that has opened up the bullish (US) Dollar door is USDCAD and I feel the picture here may well be the clearest and given its elastic character it could mean this holds the cleanest trade.

The base fact remains that the Dollar is still in a (corrective) uptrend and this should be borne in mind – as yesterday highlighted. It’s going to have its consolidation days but overall I feel next week and possible the twilight zone between Xmas and the New Year has a stronger chance of seeing Dollar gains end its move…

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 (+35 pips with open trade) and the new review of the support & resistance levels issued in the daily report and FX-forecaster Trader Package.

Have a great weekend
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Thursday, December 17, 2009

Key ranges have been defined and while the bias is still Dollar bullish watch the break levels…

No Dollar follow-through yesterday but instead a return to the seasonal deathly, dull ranges. It’s almost like the Great Market Puppeteer makes his own fun by cranks up the speed then immediately slams on the breaks… So what will he do next…?

Well, yesterday’s corrective pullbacks were within the likely stalling points I highlighted and therefore the additional blips higher to 1.4463-80 EURUSD and 1.0452-70 CHF are still valid. Recalling the same sort of call I made on Monday for a similar type move that finally ended is a stronger decline than I had anticipated I am rather cautious about this. However, what I can say is that the range and risk has been identified. As long as yesterday’s Dollar corrective lows hold the targets remain valid… If they break first then we’re already in a slightly longer pullback but I don’t see that producing any sharp moves…

This same scenario applies to USDJPY also which spent the day in a sideways consolidation. I still fancy the move to 90.70-77 but any loss of 89.38 is going to lead this back to the 88.30-40 area at least.

The bigger success on the day were the calls in GBPUSD and GBPJPY, the latter buoyed by the break higher in the former. I’d like to see this move higher again today and both seems to have positive momentum behind them but GBPUSD can’t really drop through the 1.6299 low we have seen so far. Until it does the risk is still higher to 1.6443 minimum and potentially around 1.65 while I still like the 148.57 and possibly retest of 149.08 in the cross. However, make note of break levels that would negate that or at least mean the Great Market Puppeteer has put the break on…

The only caveat I’ll make on all this is that while I can describe these moves which are frankly pretty messy now due to the illiquidity, the thing we should always keep in our minds is that the underlying Dollar trend is still higher and there is still another week or so before I see that beginning to fade. I see the cycles topping out either by the middle of next week or just after Xmas and then we should see a decent reaction back lower for the Dollar.

Today’s free analysis is for AUDJPY and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+105 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

Wednesday, December 16, 2009

We should see minor follow-through in EUR & CHF but a larger pullback is due…

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
For MT4 users

Tuesday, December 15, 2009

The run into New Year could be periods of frustration with intermittent frenzy…

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

Monday, December 14, 2009

The Dollar now looks weak into next week… no pun intended…

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

Friday, December 11, 2009

It’s still inconclusive but I tend to favor Dollar losses vs Europe but wait for breaks still…

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
For MT4 users

Thursday, December 10, 2009

It’s possible we’ve seen the Dollar high but it may be prudent to see yesterday’s lows broken…

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

Wednesday, December 9, 2009

One more rally should see the end of this first move higher…

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

Tuesday, December 8, 2009

A higher Dollar seems logical but not completely obvious…

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

Monday, December 7, 2009

We should now see follow-through higher but the larger part of the rally is complete…

I am quite happy with Friday’s display of strength by the Dollar. It came on cue and from the right sort of support areas and it doesn’t yet look complete. However, I’m not going to get carried away at this point since there are other indications which suggest that the Dollar is not about to make a powerful and extended rally.

For a start the reactions in GBPUSD and AUDUSD were not at all reflective of those in the other three major currencies and this does highlight the risk that what we’re seeing is just the first leg of the correction and we’ll have to be patient for the rest.

The targets for this move are at 1.0325 USDCHF and this should allow 1.4703 at least and at the most 1.4629. Thus the first part of the day we need to concentrate on how deep the correction will be. In USDCHF this doesn’t look too deep while in EURUSD I would prefer a deeper correction but must allow for a shallow one. I’ll outline the general levels to watch out for in the individual analysis.

For GBPUSD and AUDUSD I am slightly mixed with a few scenarios available and thus we’ll have to take these step by step.

Again, we can use the JPY crosses for clues. First of all USDJPY has pushed above the retracement targets I had that would retain a bearish outlook and thus the emphasis does seem higher still. I feel the broad 91.25-70 area has a strong chance of capping any follow-through here.

Equally, the JPY crosses still look supported and should see one more follow-through but we appear to be approaching key resistance levels and may well hold on first test. So this is consistent with USDJPY rallying but the balance must come between the strength of the Dollar versus Europe as opposed to JPY. I don’t think we should outstay our welcome on the JPY 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 (+234 pips) and the new review of the support & resistance levels issued in the daily report.

Have a profitable week
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Friday, December 4, 2009

The Dollar correction should be done and dusted…

I am pretty well satisfied with yesterday’s moves overall. Maybe USDCHF didn’t really display as much movement as EURUSD and GBPUSD but these latter two reacted as expected and thus I am more comfortable with calling the Dollar higher over the rest of this month… and therefore I guess to the end through the end of the year…

However, let’s not get carried away too soon. There is some short term uncertainty given by the JPY crosses which are sitting on key support areas as I write and if these hold then there can still be one more hike. Given that I feel USDJPY still has a final rally to go with a minimum target at 89.21 and possibly as high as 89.60, this should be the main driver of the move. However, this will probably also mean that the Dollar may decide to hang around these current levels against the Europeans just to enjoy the view before moving on…

Therefore, keep an eye out on these JPY cross supports as this looks like being the decisive factor. If they break then it’ll probably be the result of the Dollar rallying against the Europeans… If they hold, then as I detailed, the prospect may well be for some sideways consolidation instead…

The Aussie is due a pullback higher soon – probably from just below 0.9200 which will also help AUDJPY while USDCAD is pretty much in the same boat – a swift dalliance with the 1.0600 area but then a correction implied…

However, the pullbacks in these currencies, specifically the Europeans should enable us to take advantage of the pullback to establish/add to Dollar long positions…

Today’s free analysis is for EURPJPY and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s trade set ups (+50 pips) 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
For MT4 users

Thursday, December 3, 2009

It still looks as if we are still due a move back to 1.5143…

I can’t say that everything quite went to “plan” yesterday but I still can’t see any obvious reversal higher in the Dollar against the Europeans. In fact I still feel the scenario that calls for a retest of 1.5143 is still intact. This certainly appears to be supported by GBPUSD that also still seems to need to make one more push higher to the 1.6745 area (allow for 1.6753) and that in turn could see USDCHF push closer to the 0.9909 low but maybe not quite reach.

I still haven’t altered my underlying view that the Dollar is basically turning higher for the rest of this month at least and probably into next month also. This does seem to be a common implication across the Europeans at the very least. Therefore I still feel we should be concentrating on spotting key bullish Dollar set ups that could land us a solid position.

USDJPY took another step higher but I’m rather cautious around current levels (87.69.) I still feel the main direction is higher but feel there may be room for a correction first. The problem being faced at the moment is lack of common wave relationships and this is not helping in identifying the right structure. However, what we have seen so far tends to work with a corrective structure higher and there does seem further to go…

The fact that the JPY crosses are beginning to look as if there are beginning to struggle at this point is highlighting the risk of a pullback also. Whether it causes a total reversal appears to be more in the hands of the non-JPY currencies and when/if they turn lower. It may even be a combination of both if I am correct in thinking USDJPY can correct lower first. Still, this is still a bit of fluid situation right now and therefore best to take care.

Thus overall today I feel some patience in letting some of these cross plays work their way through and keeping an eye out on the Dollar lows as we approach them.

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 (+120 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

Wednesday, December 2, 2009

There are no real signs of a reversal in the decline – perhaps we shall see retests of lows…

That took me by surprise… It seems as if the Dollar bears have not yet conceded the battle and must raise the inevitable question whether this means we shall see new lows… At this point I don’t think so but it should be an alternative of which we should be aware. If I have any preference it would be for a retest of the lows but not breach which would set up a nice double top/bottom in EURUSD and USDCHF respectively… In many ways that is wishful thinking rather than being supported by a strong result of the wave structure.

However, the same is not implied in GBPUSD and this is what causes me to side with this possible scenario. Here I find it hard to expect a move above the 1.6700-45 area. So with momentum quite firm on the Dollar bearish side we should expect follow-through today but keep your eyes open of Dollar bullish divergences and if my suspicions on GBPUSD prove correct with a bearish divergence developing between 1.6700-45 then consider whether a similar pattern is developing elsewhere…

Even the JPY crosses seem a bit mixed but not really showing any signs of a strong surge higher and thus the rallies appear more corrective. Indeed, on the basis of the expectation that we are due another bout of strong weakness in the crosses it does seem likely that we shall see the European currencies weaken again before long.

This is still a scenario I am considering for USDJPY also – a marginal new high and then a reversal lower. However, the wave structure is exceptionally complicated here. I can only point to key resistance areas and suggest looking out for bearish divergences but if the two events coincide again – weaker European currencies and a strong Yen the move in the crosses will be substantial. Again, it’s some of which we should be aware but I’m in favor of this more because a straight correction higher in USDJPY just doesn’t seem to fit immediately. I do feel it will happen as the Dollar strengthens in general but there is still this flaky feel about USDJPY that has me concerned.

Equally, USDCAD still looks bearish for one more new low but I’m not really keen on a move below the 1.0205 low – more likely this should stall either around 1.0317 or 1.0266…

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 (+170 pips) and the new review of the support & resistance levels issued in the daily report.

Good luck
Ian Copsey

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Tuesday, December 1, 2009

We should now see the Dollar extend its gains…

Yesterday turned out to be pretty close to expectations although the early small extensions and corrections forced the support & resistance to be slightly off the mark. However, the retracement levels in EURUSD and USDCHF were very close to the areas I had been looking at and thus the next move should be higher and through Friday’s highs at 1.4827 EURUSD and 1.0174… This should approach the 1.4626 low in EURUSD and 1.0337 high in USDCHF – probably falling short – but then I feel we’ll be pulling back into range for 2-4 days of consolidation.

I don’t think GBPUSD is going to be quite so straightforward… It should move lower along with EURUSD but the depth of the decline yesterday which outstripped EURUSD took me a little by surprise. We’ll have to take care here but there does look like a risk of a drop below 1.6251-70 and possibly into the 1.6147-94 support zone. We’ll have to take that in stages and be aware of what is happening elsewhere.

USDJPY… much as thought, pulled back and has begun some tight ranges, whippy moves just as we suffered before the strong drop. I still have a modest bullish short term outlook but always with one eye across the shoulder. However, assuming this recovery I anticipate develops it could well remain choppy & erratic with a minimum target at 88.00-06 and maybe we can see above 89.00… well, let’s watch the first step and see how this goes… I still can’t rule out a slightly deeper correction into the 88.33-65 area before rallying.

Overall, this should mean we’ll get pressure on the downside for the JPY crosses, mainly driven by the Europeans/Aussie with USDJPY likely to act as a mild restraint. We should therefore be eying the recent lows – with some risk of minor slippage below but I don’t think this is a resumption of stronger losses at this point … unless USDJPY takes another sharp knock.

Overall I feel that concentrating on the continental Europeans is probably the better route as these appear more straightforward, followed by GBPUSD and AUDUSD…

Today’s free analysis is for AUDUSD and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (+38 pips) and the new review of the support & resistance levels issued in the daily report.

Good luck
Ian Copsey

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Monday, November 30, 2009

It looks like there is room the Dollar to pullback a little further before extension higher…

It looks as if the market has made up its mind. The Dollar strengthened further over Friday but could not break the last major corrective highs at 1.4801 EURUSD and 1.0222 USDCHF. This is quite normal and I will expect this to break. The only small uncertainty is whether we get any initial range trading or the rally will extend more directly.

I feel that the greater risk is for a fairly swift resumption of the rally which should stop just short of the 1.2646 low EURUSD and the 1.0337 corrective high in USDCHF. These areas are more likely to provide a barrier for a more sustainable and possibly complex correction.

USDJPY appears to have made its low for now. I find the structure just a little messy but more likely to be conducive to a longer choppy pullback higher. The problem I feel we may face is the same start-stop type moves which we suffered after the 88.00 low, thus slow and lengthy with an abundance of range trading.

This should, by and large keep the pressure lower in the JPY crosses but probably with the major moves now over and which should give in to more choppy and less direct moves. Take care with these unless they suddenly display excessive weakness again – but this will probably also mean the downside could come under threat once again…

The only other thing to note is that today is the last day of November and from this point forward the risk of a reduction in liquidity will slowly grow and this is more conducive to rather choppy and erratic trading. It tends to fit into the description I have made above and thus probably the next rally in the Dollar is the most direct move we shall probably see for a while. However, it does tend to lend itself to a more directional move towards the end of the year which I still feel will be Dollar bullish as books are squared up.

Today’s free analysis is for GBPUSD and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (-15 pips) and the new review of the support & resistance levels issued in the daily report.

Have a profitable week
Ian Copsey

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Friday, November 27, 2009

Time to stop watching the pendulum…

Well, that wasn’t as quiet as I had expected…

USDJPY has gone bonkers – but that loss of 88.00 was always the trigger and with the daily cycle low due I feel we may have seen almost all the losses for the moment. However, it’s another wave to tick off on the list. The target is at 84.39 but I have to add that I have found this bearish structure very tough to fit into this target area. Equally, momentum is almost a flat line at extreme oversold so it’s also tough to call for a reversal. Therefore the 84.39 area should be observed closely in case it shows any sign of recovery. Rather startlingly the next target is at 80.80… That seems a bit too low for me but we at least know the boundaries.

Of course this has had its impact on the JPY crosses, all of which have tumbled lower. I am slightly less optimistic of a deep reversal with the Dollar strength likely to add pressure on the crosses.

In the meantime the moves in the Europeans have been tame by comparison. However, the peak at 1.5143 (3 pips below the lower target) and at 0.9909 (8 pips below its target) are perhaps showing potential for the Dollar having reached a final bottom. There are still one or two tricks up the Dollar’s sleeves so we have to be careful but by and large I feel the Dollar should now spend 2 months of rally at least…

The same is reflected in GBPUSD and also AUDUSD which has lost its carry trade luster for now and I feel that overall the larger picture is calling for the Dollar to rally. It may quite possibly be a bit choppy but we’ll have to take it as it comes.

Today’s free analysis is for EURUSD and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Wednesday’s trade set ups (+0 pips) and the new review of the support & resistance levels issued in the daily report.

Have a great weekend
Ian Copsey

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Wednesday, November 25, 2009

Now even the pendulum is unsure of which way to swing next…

As tomorrow is Thanksgiving in the States the next report will be on Friday


I mentioned yesterday that time was running out but it seems the battery is low and the Dollar failed to generate any momentum in either direction. However, it did just enough to keep the possibility of a marginal new Dollar low alive… In fact, I feel there is a good chance that the battery will continue to run dry over today and tomorrow if these ranges persist.

If anything, the failure for the Dollar to make stronger headway yesterday has taken the market back into the bullish court. $-hour and hourly momentum see slightly more positive today but this can be wiped out if we get the range trading I fear there will be.

So if we are to see the Dollar make a new low it will probably be on the back of the bulls who have been buying at the USDCHF lows and above 1.5000 EURUSD. We should therefore consider the possibility that these long positions could get taken out to force the Dollar lower to target but I still find it hard to believe it will be anything but that. A quick new low and then a larger reversal as year end profit taking builds up in early December.

That’s something I still cannot get away from – with momentum really not favoring another larger directional move lower over the end of the year…

The JPY crosses, while bearish in the medium term also tend to point to sideways trading over today and tomorrow at least. That continues to mean that either USDJPY is going to manage to break below 88.00 or the Dollar is going to begin its larger recovery and I’ll place my bets on the latter. However, don’t totally ignore the downside risk in USDJPY. Yesterday’s new low was always possible and it still seems like the 88.00 low represents the break – and we could still see another new low… It’s the 88.00 that does seem to hold the key now. I’ll stick my neck out and say I feel the Dollar will rally against the Yen as well now.

So expect a quiet two days…

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 (+50 pips) and the new review of the support & resistance levels issued in the daily report.

Happy Thanksgiving to those in the States…

Good luck
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
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Tuesday, November 24, 2009

The pendulum keeps swinging… but time is running out

I remember writing some while back that the market seems to enjoy not making decisions. It’s not that the market has a collective mind but more perhaps that the willingness to retain risk is reduced by an undue level of uncertainty. The 1.48-1.50 range in EURUSD has become somewhat of a battleground for diffident bulls and bears…

All the time the pendulum swings from one side to the other. However, each swing marks one more segment of time and I do feel that we are close to a more decisive break. Of course, the million Dollar question is “which way?” Well, currently there has been no break in the weekly downtrend and frankly the break in trend as measured by key swing levels is hard to identify. The daily downtrend is clearer with the 1.4626 EURUSD and 1.0337 USDCHF Dollar highs providing those breaks.

I also think the JPY crosses should soon start falling again but whether this will be driven by a weak USDJPY or a strong Dollar-Europe is the key question. For those of you who have seen the weekend wrap on
http://www.fx-forecaster.com/files/Daily_Support_Resistance_20th_November_2009.pdf you will see that I feel that while the weekly Equilibrium Clouds are quickly catching up with price action and daily is oscillating around its own Cloud it still does not rule out a marginal new low.

So the uncertainty is still quite strong. From my own method of projections we have come close to, but not quite reached minimum targets at 1.5146 EURUSD and 0.9932-63 USDCHF. If my measurements are correct then even if the Dollar does dip there is very little downside left. With end year coming and the probable need to pare positions and book profits could also be a determining factor but quite when that will begin is not 100% clear.

So… we have the two sides of the coin… Flip it and see what we get…

However, so far the retracements we saw yesterday stalled around the right areas to be part of a large complex correction. I think key areas to watch fro are probably around 1.4900-25 EURUSD and 1.0138 USDCHF… Much beyond and the pendulum will be swing back to Dollar bullish… However, I’m not convinced it will swing back any more after this…

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 (+45 pips) and the new review of the support & resistance levels issued in the daily report.

Good luck
Ian Copsey

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Monday, November 23, 2009

The pendulum keeps swinging…

Just as it looked like the haze was beginning to dissipate the autumn breeze shifted and carried the haze back to settle over the low lying land… It may still be shrouding the short term picture but the horizon still remains visible I still feel this will turn into Dollar gains.

In the process though the pendulum has reversed back to bearish but it’s becoming tough to firmly hold either short term view until the break becomes a sustainable one. When I looked at the longer term charts the weekly trend remains in place – but the daily trend has slowed to an extent that it will take very little to see the Dollar begin its ascent.

One additional clue on Friday was GBPUSD which broke below the 1.6496-14 targeted support. The low at 1.6459 was not a million miles below but it sure doesn’t look as positive as it did on Friday.

The week has begun with the market taking advantage of the high Dollar and has made the first move this week a negative one. I want to say that it won’t go too far. The problem I see when I look across the European currencies is correlation. Yes, they are all moving up and down at the same time but to differing degrees and when trying to correlate the structure the subtle differences between them makes for some head scratching and quizzical expressions.

Clues we can look for may well be in the JPY crosses which do seem to require a bit of a pullback higher. Now, this can be generated by a rally in USDJPY or Dollar losses against the Europeans. Well, USDJPY is still not really showing much sign of doing anything but flapping about in ever decreasing ranges, still holding above critical supports but not really displaying any strength. I think it’s due at some point over the week but until it moves above key resistance I’d prefer to remain neutral.

Hence this places the emphasis on Dollar weakness… However, unless we get substantial weakness the pendulum will probably retain its constancy of swing… but to see new Dollar lows we’re going to have to clear the sequence of higher lows … once this occurs we can begin to consider a larger marginal new low before reversal… On the same sentiment, if it doesn’t manage this then the Dollar upside beckons…

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 (+60 pips) and the new review of the support & resistance levels issued in the daily report.

Have a profitable week
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
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Friday, November 20, 2009

Today will probably be mostly range trading – but possibly setting up the final decline

After Tuesday’s & Wednesday’s reports I hope yesterday made up for those dreadful calls. I feel much happier that we appear to be coming back to a semblance of normality. However, the first Dollar resistances basically held and this morning the trip above 1.4927 EURUSD and below 1.0126 USDCHF are tending to point toward a day of range trading and probably later in the day seeing the Dollar dip a little lower in this range. My estimates for the ranges in these two are 1.4870-1.4960 EURUSD and 1.0095-1.0166 USDCHF.

Now, while these range limits look good for the continental European pair I’m not quite so convinced that we’ll see the same in GBPUSD. Here I feel we can see a drop below yesterday’s 1.6606 low with the target I mentioned yesterday at 1.6496-1.6514 still expected to be seen and should provide a firm base.

Now if all this develops as I expect… guess what? It will imply Dollar losses into those weekly targets I have repeated many times over the past few weeks. Well, that should be a story for next week. There is the chance that we may just see the end of the range trading in the other two Europeans as well which could – and should – end up with a push back lower for the Dollar but I’m not sure there’s enough time to see this press through today.

Elsewhere USDJPY actually dipped yesterday and puts the structure in a position that could lead to further gains but it’s one of those ambiguous pivotal points where it could go either way. However, even in the bearish scenario it should still mean we’ll see a retest of the 89.53 high again – it’s what happens from that point which seals the deal for one of the alternatives. Well, we should allow for a small overshoot above 89.53 but no more than 89.70. If it remains below then we should see one more 3 legged move lower but still see it end up above 88.00 for the next rally. If not – then next week is going to be frenetic… probably feel the wind brush past your ears as a cycle low is due and there’s probably 400 pips to the next major target on the downside…

AUDUSD has either seen its low – or perhaps see a minor new one – but the bigger picture still seems to suggest the upside beckons. The market doesn’t give up on a bullish Aussie picture too quickly… The interest differentials still can bring home some useful pips before Xmas…

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 (+38 pips) and the new review of the support & resistance levels issued in the daily report.

Have a great weekend
Ian Copsey

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Thursday, November 19, 2009

I’m ready to have my neck cut off again… but I think the Dollar goes straight back up…

The past two days I have provided some quite horrendous calls… I can only offer my apologies. When I look at this type of price behavior (in EURUSD and USDCHF) I see a greater tendency, more frequently than not, for it to be corrective. Indeed, it has the characteristics of a possible large triangle. Well, it’s far too early to be absolutely certain and thus we’re going to have to take this step by step. It has been a crazy move and much of it quite reactive, having the look of a market that is seeing bulls and bears slugging it out.

There are a couple of reasons why I have been pushed towards this Dollar bullish view. Firstly the break down in GBPUSD below 1.6729 really doesn’t support continuation of an upward move. The implied result appears to be a move back to the 1.6496-1.6514 area. That’s quite a large drop and within a larger triangle structure in the continental Europeans this type of move would also be implied…

So today will be very much a defensive structured analysis though I’ll hang my hat on the Dollar bull side for now but do not be too surprised if the volatility continues. However, there is some minor risk of a short blip lower early in the day. I prefer a more direct bullish scenario but we should cover the rear-guard.

I also see AUDUSD looking bearish too – and what’s more the JPY crosses and these look more to be driven by Dollar strength against the Europeans/Aussie than USDJPY. I am mildly bullish for USDJPY in the short term and probably medium term but I still can’t rule out one more dip below 88.72 but probably remaining above 88.35-45. This could happen on one of the pullback in the Europeans. There does seem to be a cycle low in USDJPY next week but I’m not super bullish here. More I see a minimum of 92.89 and maximum 94.04 over the coming 2 months.

So, I suggest we start the day with this awareness but let the market conform this call. If it begins to play through then we should have plenty of opportunities to take advantage of the expected rally.

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 (+70 pips) and the new review of the support & resistance levels issued in the daily report.

Good luck
Ian Copsey

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Wednesday, November 18, 2009

Further Dollar gains should be seen today but take care at 1.4732-62 EUR and 1.0266 CHF

Ouch… that was not a good day yesterday... The easiest interpretation of the Dollar’s rally yesterday is to get very bullish. Well, I am basically bullish in the medium term and always have been, but it’s the navigation of the lows that has been rather messy.

Now why would I have any reservation over a direct Dollar rally? Well, as much as EURUSD and USDCHF saw strong moves, and to a certain extent AUDUSD as well, the Dollar strength wasn’t uniform. GBPUSD hardly showed much enthusiasm and while AUDUSD did drop it still has hurdles to overcome. I’ll be using these two pairs to identify whether this is THE Dollar reversal or is just another spoof in an alternative corrective structure. We’ve already been whipsawed a couple of time in this and I feel we should just be aware of the areas that could have the potential to do so again…

That said, I still think the Dollar will make a follow-through push higher today. We’re quite close to support levels that should hold and trigger another rally and it’s the 1.4732-62 EURUSD and 1.0266 USDCHF areas that need to be watched closely. Along with this is support in AUDUSD at 0.9191-06 and in GBPUSD at 1.6729-51.

I will expect a reaction from around those areas and the manner and extent of the reaction that will provide us with the clues we need.

Meanwhile USDJPY didn’t even reach my 88.63 support and instead has pushed higher. It’s encouraging and if I have any preference then it is still for continued gains but I’m not yet convinced that this is anything more than a correction. I am being pulled more towards the view that we’ll see another new low but I’m not yet convinced this will be below the 88.00 low… For me the 88.00-90.60 range is key here.

That should probably leave the JPY crosses looking a bit soft – though GBPJPY has been more supported through the relative firmness in GBPUSD and this may well continue. The crosses may well still be in a similar situation to USDJPY in seeing a choppy corrective move lower but the longer we see USDJPY fail to break below 88.00 it seems as if any weakness is going to have to be driven by the other side of the currency equations – in EURUSD, GBPUSD and AUDUSD…

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 luck
Ian Copsey

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Tuesday, November 17, 2009

There seems to be a risk that we could see Dollar losses directly – but take care around the lows

Yesterday was mostly successful, the Dollar lows identified quite well in three of the four majors (excluding GBPUSD) and the high in AUDUSD. The only thing that has me wondering is the sharp recovery from initial lows and the rush to marginal new ones… Several different scenarios can be generated from this and interestingly one of them is direct losses to the major weekly targets. This latter scenario which was not high on my list of preferences yesterday has come about through the strength of GBPUSD and also AUDUSD.

However, if we do see direct follow-through it would limit the EURUSD target to the 1.5146 area while 0.9932 USDCHF is implied and probably a retest of the 1.7041 high in GBPUSD.

It’s food for thought and can’t be ignored but nor should the Dollar bullish side as well. I think I probably favor the downside now, but there are clear breaks to prove this wrong and we have to remember that the market has been quite erratic over the past week and thus it wouldn’t take too much for another sharp reaction.

USDJPY developed as expected yesterday and I’d like to think that for now the larger downside threat may have abated. However, always keep your eye over your shoulder for a drop below 88.46-63 which could begin to tip the weight too far in favor of the downside – and when this breaks it should be quite strong I feel. My preference here is for a choppy recovery but I can’t see any strong signs of excessive strength just yet.

That is all reflected in the JPY crosses also which are going nowhere very fast… The consolidation has become so much of a mess it is really difficult to judge what the next move will be and I feel we’ll have to be very careful here. I’d prefer just to let them rest for now and wait for more definitive signs from the majors first.

AUDUSD still look bullish and has support between 0.9284 & 0.9307. The target appears to be around 0.9499. USDCAD is also a currency that is busy going nowhere and much like the JPY crosses we need some catalyst to break it from the corrective price action we have been seeing.

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 (+85 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
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Monday, November 16, 2009

The market returns into an area that keeps both bullish & bearish scenarios alive…

The Dollar is beginning to resemble a rollercoaster… The depth of the pullback higher was very deep – deep enough to signal a reversal on the vast majority of occasions. However, this morning it has opened weaker with the losses really not consistent with a stronger Dollar. So we are left standing between two scenarios and neither really appears that convincing.

It does open possible alternatives. If I look at the Dollar move higher as a complete correction it really has to stretch to reach the downside targets I have been considering, though it could come close to weekly targets. It is therefore possible that we may see a sideways consolidation develop which will mean that at least half the week is going to be unpleasantly erratic and choppy. I’ll list down the break level that would imply each within the individual analyses and until there is a clear signal in one direction it will be best to remain cautious.

Even USDJPY is not exactly how I’d expect in the extreme bearish scenario I have been cautiously regarding. If this is to turn very bearish then we’ll need to test the 88.00 low today preferably ay a stretch tomorrow. However, in the meantime we’re going to have to be careful around the 88.63-91 area. If this hold we could revert back into the recent range again. This latter scenario wouldn’t rule out another low but we may have to accept that until the 88.00 low breaks that we may just be seeing a deep correction to the rally from 88.00 to 82.31…

If the 88.00 level breaks then the game is over with the next major target at 84.39.

Even the JPY crosses have been reticent to state their direction clearly, the last week really having provided a big messy consolidation. Obviously we’re going to need this to break decisively – and in tandem with USDJPY … probably. The threat from a stronger Dollar against the Europeans appears to have abated but if this resumes there could even be a threat from this. However, this will need a break above the Dollar highs at 1.4825 EUR and 1.0193 CHF.

So we’re still at a stage where we have to be aware of both sides of the story but I suspect that by the end of today or tomorrow we’ll hopefully have a clearer picture…

Today’s free analysis is for USDCHF and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Friday’s trade set ups (+144 pips) and the new review of the support & resistance levels issued in the daily report.

Have a profitable week
Ian Copsey

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Friday, November 13, 2009

It certainly looks like the 1.52 and 0.9932 targets will not even be approached…

Obviously I didn’t expect that reaction in the Dollar… The rally has gone far enough to pretty much confirm that we shall not see the targets for which I had been patiently awaiting… If I wanted to be desperate perhaps I could concoct an argument that we’ll now see a triangle and from the end of that we move to those targets but I can’t even see that happening to be honest.

And that means I have to lick my wounds and treat this decline merely as a deep correction. The interesting point about this is that on the assumption that we now see a Dollar rally beyond the highs at 1.4626 EURUSD and 1.0337 USDCHF they will both form (Dollar) double bottoms with the targets being very close to where I would expect this correction to stall…

However, from what I have seen so far I can’t see this move being totally direct. I have to think in terms of projections, targets and how structures will fit into this and from what I think I see we may not get much beyond the highs in the last rally… It will also mean that we should see quite a direct move with shallow pullbacks. Thus, if price begins to deviate from this scenario it will suggest some other, more complicated structure and I’ll need more development to be able to judge what that may be. Thus, for now I’ll remain pretty directly bullish but if you see any deeper pullbacks than I suggest in the analysis take care…

The other move of note was the sudden rush above 90.25 USDJPY. This has certainly lifted some of the doom and gloom surrounding it and I’d like to think it can carry on rallying. To really confirm this we’ll need it to push above the 91.61 high which is obviously still some way higher. The thing that concerns is that of late USDJPY has been almost perfectly displaying negative correlation with USDCHF… So it’s not quite out of trouble but while 89.29-63 holds the chance for gains remains…

That the JPY crosses still don’t look particularly healthy is a little less relevant given what should be Dollar strength against the Europeans at a faster pace than against the Yen. The structures in the crosses are exceptionally erratic right now and may well continue a little longer though I have a more bearish view on these.

Thus, today should really favor a stronger Dollar all round but do take note of the key supports…

Today’s free analysis is for GBPUSD and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with Tuesday’s trade set ups (+70 pips) 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
For MT4 users

Thursday, November 12, 2009

We should see the final Dollar declines to 1.5200-15 and 0.9917-32 by tomorrow…

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 luck
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Tuesday, November 10, 2009

Now we can plan the route to the 1.52 and 0.9932 targets…

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 luck
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Monday, November 9, 2009

The Dollar must surely break out of its range today…

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 week
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Friday, November 6, 2009

The Dollar has edged towards the downside – just a little more confirmation required

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 weekend
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Thursday, November 5, 2009

Dollar reaches pivotal areas between bullish & bearish

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 luck
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Wednesday, November 4, 2009

The Dollar is a step closer to confirming a sustainable correction

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 luck
Ian Copsey

NEW!! FX-forecaster Trader Package now available at €20.00 pm
For MT4 users

Tuesday, November 3, 2009

The market doesn’t seem ready to commit to the Dollar’s downside – range trading expected

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 luck
Ian Copsey