Wednesday, April 28, 2010

We should see further Dollar highs but less aggressively today

Well, in the end the market didn’t quite make it to my full retracement levels and the Dollar resumed its rally both directly and aggressively. It has made good progress towards its next intermediate targets which should be seen by late today of perhaps tomorrow. From that point we should see a correction that may well last over the weekend. However, next week should extend those gains further to the higher targets by the second half of the week.

This is going to prove to be an interesting moment as very clearly the technical picture and structure I am looking at flies in the face of the turmoil surrounding the European community. It will be a “do-or-die” moment when it comes. However, at this point everything is coming together with the structure I am following and is the culmination of the entire decline from the 1.5143 high EURUSD and the 0.9909 low USDCHF. As we approach those targets we shall need to watch momentum to ensure that it has deepened the daily & weekly divergences… However, that is still a week away and time will tell.

Over today I see the current correction from the 1.3145 low EURUSD and 1.0898 high USDCHF deepening further but by probably the second half look for the additional follow-through. That looks pretty similar in GBPUSD and should face a test of the 1.5141-1.5192 key support area. This area is vital for the Pound’s bullish structure. Thus watch this carefully.

Elsewhere USDJPY fell back into the 92.74-97 support area. I think this will hold to generate further gains. Thus the downside in the JPY crosses should be limited though probably we’ll see a little more but like the Europeans they shouldn’t be as aggressive as yesterday.

The Aussie joined in the decline and likewise the downside should be more limited and we’ll have to wait for next week. USDCAD broke the key resistance and flew higher. If anything is going to fly it’ll be this I feel…

So overall the day should be less dramatic than yesterday but look to buy into Dollar dips – I’ll outline the key Dollar supports in the individual analyses.

Today’s free analysis is for AUDJPY and can be found on along with yesterday’s Trader Package Review & Trade Set up report (+20 pips).

Good luck
Ian Copsey

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

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