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HARMONIC ELLIOTT WAVE

Friday, March 5, 2010

The Dollar uptrend appears to be resuming

The alternate Dollar bearish structure broke down pretty quickly and this really opens up the underlying uptrend and as long as any pullback today is contained I think the next stop will be back around the recent highs but not for too long. Overall I think this is going to be a solid extension of gains and has potential to reach the next targets as early as next week or perhaps into the following.

One small interesting development was the limited decline in GBPUSD and as long as the 1.5005 low hold I feel that we should actually see this reach its upside target as EURUSD and USDCHF also see a correction to their moves. However, make no mistake, the recent bearishness for the Pound does look like extending but perhaps maintain a similar pace to its European comrades.

What has confused me somewhat is USDJPY. The 88.18 target was met and mildly overshot but this was meant to be a temporary low. However, the pullback has been pretty deep and I have some problems in being totally comfortable with the structure. At this point, as I feel the downside targets are still much lower it looks like this is just a correction and probably a needed one as the decline from 92.14 has not seen too much. Therefore I still feel we need sell into this recovery but I doubt it will get above 90.00 on this move.

This has kept the JPY crosses in check and still pretty choppy. I don’t think the consolidation is complete yet and may just see some new highs but overall I remain bearish for these crosses. There does seem to be a little way to go and if my Dollar-Europe view is correct along with the need for new lows in USDJPY the coming decline can be pretty aggressive.

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 (+80 pips).

Have a great weekend
Ian Copsey

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

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