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HARMONIC ELLIOTT WAVE

Thursday, February 11, 2010

Steady as it goes… there are still conflicting indications…

Well, the follow-through lower for the Dollar didn’t happen… Does that mean that it’s still in an uptrend? Technically yes it is and until we see breaks of the most recent Dollar swing lows that’s the way to view it. Could it still dip a little further and still rally? Yes it could. However, even this raises some question marks as to fit this into a Dollar uptrend it would mean that a new high not too far above the highs so far would probably force a pullback at the very least.

I will admit that I find it hard to generate a valid Dollar bearish structure at this point in time in the Europeans. The only indications were the proximity to key Dollar retracement levels that would fit into a multi-year bearish cycle. However, that’s about it and therefore it’s probably wiser to continue with the uptrend until some event causes a reversal.

Having said that I do feel that the pullback lower can extend a little bit further today and then we’ll have to watch for key support levels to hold. It could therefore be a day much like yesterday.

However, the rally in AUD and AUDJPY which has resumed more aggressively this morning is more encouraging. In reality it is still early days but the lows from where these bounced are definitely ones that would fit into a much larger bullish structure… Already the moves seen this morning could generate quite a solid follow-through.

The only thing to drag back AUDJPY is USDJPY which has continued its struggle higher. I do feel though that momentum conditions are slowing (not that it was particularly robust…) and we should see a high later today that should cap for a reversal lower. Watch the 90.37 area for this.

Finally, it does appear that USDCAD has laid down and died again… watch this carefully…

Today’s free analysis is for EURJPY and can be found on
http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & trade Set up report (+225 pips).

Good luck
Ian Copsey

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

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