Pages

HARMONIC ELLIOTT WAVE

Friday, May 28, 2010

There should be more Dollar losses to come…

With Monday being Memorial Day in the States the next report will be on Tuesday


The underlying call for a weaker Dollar was right yesterday but what was frustrating was the lack of marginal new highs before they developed… However, I’m not sure it materially alters the outcome which means there should be further losses to come today and may just stretch into Monday.

Having said that, the extremely choppy behavior in early N.A. trading was not really expected but does still fit into the overall Dollar bearish structure. In particular USDCHF turned in a complex correction but still targets the 1.1374-86 area and I’ll be using that as a marker for the other Europeans. First thing seems to suggest a small pullback but I doubt this will be too deep and by early European trading we should be seeing the Dollar lose out further. More complete details of support & resistance will be in the individual analyses.

USDJPY held on by the skin of its teeth and spent the day looking firm and has probably done enough to suggest we’ll see more. I feel over time this should lead to a retest close to the 93.63 high. The combination of EURUSD and USDJPY should mean the EURJPY cross is going to probably be the better value for money and certainly reach the 114.38 corrective high and I suspect further.

AUDUSD joined in with the others in ignoring my thoughts that a minor new low should occur before the recovery and just took off by itself. Like the Europeans this has further to go still… And finally USDCAD also did its own thing… I’m just a bit concerned with this one as the best fit structure I can see is a move right back to the 1.0110 low… That is quite a call though this currency pair can do loonie things but it will be well to be a bit careful on this one.

All in all I still feel the moves we are seeing are probably more corrective than a total reversal in the overall trends so unless key levels break I’ll stick with this being the last stage of the larger correction…

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. (+135 pips)

Have a great weekend
Ian Copsey

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

Thursday, May 27, 2010

I can’t help it but I still see the Dollar falling back…

The Dollar bearish structure soon broke down yesterday and has provoked follow-through in both EURUSD and USDCHF although, as seems to be normal these days, not to the same degree. GBPUSD on the other hand decided it was more interesting to watch the other two and retain its range trading. Thus I am left eyeing a potential test of the 1.2143 low EURUSD and probably a mild overshoot.

However, momentum has not been startling and is beginning to show signs of bullish divergences in both hourly & 4-hour charts. When I look at this along with what appears to be a potential sideways channel correction in USDCHF which does seem to require a deeper pullback lower I begin to think of corrections recycling. Add to the mix the indifference in GBPUSD which also looks more corrective and it appears to add up to the same result…

Thus, while I do feel the Dollar should probe a little higher following the current correction I am more inclined to say the Dollar will end much lower today.

Now, USDJPY concerns. It failed just below the key 90.96 resistance and the pullback has stalled tantalizingly between bullish & bearish scenarios. I still have a mild preference for the upside but any loss of this morning’s low would cause me to abandon that pretty quickly… That picture is confused by EURJPY which failed to make any further bullish headway yesterday and instead drifted lower for the majority of the day. This is one I find particularly tough to decide upon with projection ratios not really holding in either direction. The fact I feel EURUSD will bounce should keep it supported but the immediate issue is whether it will make any new low before the recovery. This we’ll have to take carefully and watch what happens to USDJPY also…

AUDUSD – failed in the 0.8361-96 resistance as expected and does seem to be pointing lower again to new lows but I don’t expect a runaway decline and probably a reversal later in the day – or maybe tomorrow. USDCAD surprised with the depth of the correction but I remain bullish and to a higher target now…

Today’s free analysis is for AUDUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html 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

Wednesday, May 26, 2010

Do I see a bullish Euro & GBP structure… or am I reading too much into the recovery?

Yesterday’s losses in EURUSD and GBPUSD surprised by their depth but these weren’t enough to break the old lows. It did help USDCHF higher at long last, even breaking above 1.1666 in the process but not by too much and capped just a few points above the next resistance at 1.1691…

It has left me with a headache. Well, trying to make sense out of just price movement can do that at any time, but there are times when the Dollar looks strong against one currency and weak against the other. This situation occurs between USDCHF and the other Europeans… Perhaps that is possible given the moves we have seen recently but wow… that would put the cat amongst the pigeons…

What I feel I have seen are complete corrections lower in EURUSD and GBPUSD… By saying that I should explain that this event would imply new highs above those seen over the past week… I could even go as far as to say that one interpretation would be very, very bullish for them but I’d rather leave that until I see what happens today first…

AUDUSD looks bullish – but here I’d only go as far as suggesting a minor new high between 0.8361-96 and then a second dip to a new low before a decent correction.

Momentum hasn’t really broken down with yesterday’s moves and there’s even an argument for further gains for EUR & GBP. Therefore, I think how I’d like to approach today is to take things step by step, noting the break levels and seeing whether the bullish potential actually holds.

USDJPY has recovered well also and almost looks as it, too, wants to break higher. Equally I’d prefer just to be cautious until the 90.96 area breaks – once it does then we can expect quite a decent follow-through. This tends to match with EURJPY that from the low yesterday does seem to want to retest the old 114.38 high – and maybe just above – but that should be it.

Hence this last clue is one of the issues that make me cautious. If EURJPY is to extend lower and below yesterday’s low following this correction either USDJPY or EURUSD has to drop considerably. Hence, for me the day is one of caution, observation and noting breaks.

Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+235 pips)

Good luck
Ian Copsey

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

Tuesday, May 25, 2010

Correction almost complete so the Dollar should extend its losses

Overall the expectation for the Dollar to correct some of its losses developed quite well with the follow-through higher in USDCHF developing at a slower pace than EURUSD losses. At this point I don’t see any substantial follow-through though there does appear to be need for one more push on the Dollar’s upside before the larger losses develop.

Probably the most telling move of the day was in GBPUSD. That began to go my way but failed to make sufficient headway before the Dollar began to push higher. This caused a much deeper pullback than I would have liked. However, I do feel it’s a correction and not resumption of the Dollar’s uptrend but the depth of the pullback here is deep enough to suggest that the weight of argument is for these Dollar losses to be corrective only.

This will imply that before the end of today we should begin to see the Dollar losing ground once again. There does seem to be room for extending its gains over the first half of the day but only marginally and I feel this is where we should be concentrating to identify just where this will end.

USDJPY reached the low end of the critical 90.62-96 resistance and the market now faces a pivotal decision in whether the decline will break below the 88.13-21 lows or resistance the temptation in favor of further daily gains. It has set itself up to generate some decent bullish divergences so the question is more whether the market has the determination to cause a stronger follow-through… It’ll be a tight call I feel but my preference for the upside to become stronger. However, I’ll wait for confirmation.

This seems to be reflected in EURJPY – a similar decision to be made if this is going to attack the 109.46 low. I think the deciding factor here will be EURUSD rather than USDJPY…

AUDUSD failed to break above the 0.8361-96resistance and until that breaks the risk is still lower. USDCAD edged to a new low but I fancy this should resume its uptrend now…

Today’s free analysis is for EURUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+70 pips)

Good luck
Ian Copsey

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

Monday, May 24, 2010

This week looks to emulate last week, perhaps with the exception of USDJPY

I can’t say Friday surprised too much. The reluctance to buy European currencies versus the Dollar remains but at this point the Dollar is mostly on the back foot although without any solid follow-through. Indeed, I feel the start of the week could see the Euro under pressure again but probably on through today and possibly a little tomorrow. It seems more like a situation where neither Euro Bulls nor bears really have any commitment and awaiting a catalyst that will provide the next directional move.

Overall I still see more potential for the European currencies to recover over the rest of the week and we’ll have to observe how this progresses to judge whether the structure is constructive. In the larger picture I can see arguments for both sides of the coin right now, some early evidence of a larger reversal (or correction) but until this develops with sufficient robustness the need to keep an eye out over one’s shoulder is still a definite requirement.

In particular GBPUSD has a structure that could slot into a correction or a stronger upward move. How this develops over today and tomorrow is going to be important.

USDJPY… staved off any further losses on Friday but is not yet out of the woods. I do still see upside progress in EURJPY although only in a correction. The eventual target still seems to be closer to 100-105 to me and therefore the question is whether EURUSD or USDJPY leads that charge lower – or both of course. That’s still a day or two away but until 90.62-96 USDJPY is overcome the downside is still a significant risk.

I still feel the Aussie has one more dip to go in the part of the downtrend but then a more sustainable pullback. This tends to fit in quite well with the picture in the Europeans. USDCAD – just a bit concerned there as the pullback from Friday’s high has been a bit deep for my liking. So much so that if it pushes much more there is one scenario that would call for a recycling of the correction all the way back to 1.0110 again…

Today I feel is about the market consolidating its outlook to the Europeans, probably mostly Dollar bullish but stay alert for some individual performances but I doubt with any vigor.

Today’s free analysis is for USDCHF and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s Trader Package Review & Trade Set up report. (+95 pips)

Have a profitable week
Ian Copsey

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

Friday, May 21, 2010

The correction has continued but maybe today won’t be quite so direct

Partly good, partly bad and partly frustrating is how I’d explain yesterday I think. Overall however I am encouraged by what has been seen and the prospect of the pullback in EURUSD and GBPUSD remain intact. However, following these first bursts of correction I feel it could now become more complicated as we go into the weekend.

There’s no doubting that the market hisses and spits when anyone mentions the EU and that isn’t going to change particularly quickly, at least not without some new catalyst entering the market. Therefore the risk is for there to be as many bears selling into rallies as there are bulls looking for a deeper correction. GBPUSD faces the prospect of trying to overcome the 1.4518 high and I have my doubts that this will happen today though it may well be approached.

We also have the conflict between EURUSD and USDCHF, the latter remaining stubbornly in its range while EURUSD did all the hard work. The possible upside in USDCHF hasn’t totally gone away but it didn’t do itself any favors yesterday. Maybe this pair will provide the pointer to the next move although even then there is a certain inefficiency in the link at the moment. What this does mean is that care is going to be required. Overall I think these two have potential to be more erratic today if they fail to break key levels.

USDJPY… what a drop… Will it manage to break below 88.21 or will it just shave it? Frankly it does seem to be a critical point as loss of this area would appear to place a lot more bias to the downside. However, I sense that it won’t – at least not yet – as EURJPY seems to have found the low I was looking for earlier in the week, only a little lower that I anticipated. This should now correct higher in a manner which appears to promise erratic itself but I think buying the dips for now to be the way to go.

AUSDUSD… once the safety new of the market – if all else fails buy the Aussie now just doesn’t seem to apply. While I feel a pullback is due I still see lower levels… USDCAD on the other hand performed very well and should continue to extend its gains. The 1.0737-41 area may well hold once again though for a pullback. Overall it still has much higher to go and I feel eventually the 1.1220-30 area is possible – maybe by late next week.

Take it more carefully today…

Today’s free analysis is for USDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+70 pips)

Have a great weekend
Ian Copsey

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

Thursday, May 20, 2010

At the very least we should see a more sustainable correction

All those extended targets were left waving in the air as the Dollar staged a much earlier reversal. What can we make of this? Well, the 1.2143 low in EURUSD was only 10 pips below a target I have mentioned from time to time at 1.2150. I admit the approach and the momentum position at that time did seem to point to a new low, the same for GBPUSD. However, it does seem to imply that we shall see a more substantial retracement at the very least. The thought that it could even be a much deeper daily retracement cannot be ignored but this will need quite a move yet to suggest that is possible. Therefore, I’ll take this step by step.

There is a little intrigue to be investigated in terms of the apparent decoupling of EURUSD versus USDCHF and the sight of them both rallying is quite mystifying. Certainly USDCHF met its minimum target at 1.1585 though I still have this higher area at 1.1666 which does attract. However, it is uncertain how long this decoupling can last and may suggest that the initial rally in the Euro may well be over and as we see a pullback USDCHF can extend higher towards target.

A further interesting event was the high in the Dollar index which reached 87.45 which is very close to a triangle target. That has a daily bearish divergence also so a pullback seems quite realistic here also – and maybe a turn down for the next leg of the triangle…

The reactions so far have been constructive but I’d still like to take the next step cautiously. Market sentiment against the Euro is not going to disappear overnight and on one day’s move. More work does need to be done. On the other side, while EURJPY fell short of target it does seem to be due for a correction higher but only within the realms of this being a correction. New lows are implied and that’s going to need either EURUSD to push to new lows – or USDJPY… The latter bounced nicely from support to retain a sideways consolidation and while this still needs a day or two more to complete the break of the 90.92-93.18 range does appear crucial. I’d prefer higher but then either EURUSD has to drop or the correction in EURJPY has to recycle higher. All this is a little beyond a daily horizon but useful to slot into memory banks to identify key breaks…

The Aussie… wow… and doesn’t look over but does seem to need a correction. USDCAD actually looks as if it can push higher again…

Today’s free analysis is for USDCAD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+0 pips)

Good luck
Ian Copsey

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

Wednesday, May 19, 2010

Almost there – but there still seems a little more to go…

It was good to pick the right stalling areas for the correction yesterday which raises the confidence that the structure is developing as expected. I had noted the 1.2150 EURUSD and 1.1542 areas to watch for but this doesn’t look enough with 1.2143 and 1.1530 achieved in these Europeans already this morning and this not really appearing to complete a full structure. However, I suspect they’ll cause a modest correction into European time – may just stretch to NY – but overall I feel today stands a good chance of seeing a significant low. I’m not sure this is a final Dollar high – but for now this should spark a much deeper correction than we’ve seen since 1.3086 and 1.0923.

In addition GBPUSD has made a new low too – so we need to plan for a deeper follow-through – but equally a more sustainable correction should then develop.

When I look at EURJPY, which peaked in the perfect area yesterday, I see a similar picture of a pullback from (probably) just below the 110.60 low but this still has further downside to go. Unless USDJPY is going to collapse – which is not my favored view – then it will mean further Dollar gains against the Europeans but that should occur either by the end of this month or early into next.

USDJPY itself remains in its coma, barely seeing much of a move in either direction. Frankly I can’t quite yet see the end of this although if there is to be any surprise then it’s the downside that would do the trick. However, unless it gets back below 90.84 I feel the range can continue for another day or two.

AUDUSD – now here I have a longer term dilemma. I still see the current decline reaching the 0.8530-78 area. I had been looking for this as a possible end to the recycling from the original 0.9404 high. However, I’m not totally comfortable with the momentum picture. I do feel that this area will provide a pullback but I’d rather wait & watch to see how that develops.

Finally USDCAD corrected a little deeper than expected and this has changed the balance a little. I still have a stronger bullish outlook but there does appear to be a risk of a sideways consolidation so unless this presses strongly above the 1.0435 high we should be prepared for it to revert to what it does best – making erratic and messy sideways corrections.

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. (+190 pips)

Good luck
Ian Copsey

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

Tuesday, May 18, 2010

There still appears to be further to go but this next Dollar high should trigger a deeper correction…

When the market is moving rapidly while I’m performing the analysis or even writing the report the support & resistance can take a bit of a pummeling. The Dollar highs we saw early in the day certainly pushed a little higher than anticipated but the rest of the day saw more corrective price action. Were yesterday’s lows the trigger for that deeper correction I have been looking for? I don’t think so.

There certainly looks to be room all round – well, perhaps not GBPUSD – for the Dollar to push higher still today. I don’t think the correction is quite complete so this should provide us with a Dollar buying opportunity and then there’s a little more overlap to go to what I feel will be a target that will provoke a much stronger reversal – corrective only still. I shall provide these targets in the report. Overall I still see targets for EURUSD below 1.20 and USDCHF may just approach the old 1.2296 high…

USDJPY has remained as subdued as expected and I don’t think it’s complete yet. I do feel there should be another dip on its way and therefore it’s just a matter of whether the pullback higher gets any deeper. Thus, EURJPY should find a high probably in the European morning for losses back to around the 110.60 low – probably just below.

AUDUSD – no change the downside remains under pressure. I still feel there should be a decline closer to the 0.8578 weekly swing low. Could this happen today? I doubt it but certainly by tomorrow. USDCAD – watch this carefully as there is a risk of consolidation but I tend to prefer a scenario calling for a minor new corrective low but then the charge higher could well develop… and I suspect above 1.0600…

Today’s free analysis is for USDCHF and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+0 pips)

Good luck
Ian Copsey

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

Monday, May 17, 2010

It’s very difficult to be Dollar bearish – but take care around 1.2256…

Nope… no pullback and the beleaguered Euro has seen its losses extend beyond any chance this may happen. However, I still note the total lack of correction since the 1.3086 high and unless this is a spike low we must see a solid pullback at some point – the question being from where. Again, I have studied the weekly & daily charts and see three potential targets, the first around the 1.2150 area I mentioned last week, the next around 1.1961 and then not until 1.1475-00…

The lowest target also has a time target – this being either next week or possibly the week after. Well, the way the Euro has become a reviled package when playing pass the parcel we just can’t rule this out. It does seem a bit extreme but then two weeks ago a 1,000 point decline in two weeks seemed a bit extreme also.

This does raise the specter of central bank intervention and if I am to try and tie this to a wave count then the 1.2256 area would be good for a correction. Thus take a strong look at the area if seen to see whether there are any signs of a reversal signal. Certainly, the daily chart is now sporting a decent bullish divergence and with negative moves running out of the series this should hold. So technically the prospect is there. However, until something more substantial occurs there is limited sentiment for a reversal…

USDJPY still confuses. I suspect the sideways range is to continue as trying to fit the moves into the larger structure (even allowing for bullish & bearish alternatives) juts doesn’t seem to fit in. This should keep EURJPY under pressure and this appears evident from that cross’ analysis too. Thus, unless USDJPY makes any break of range it is probably best to stay clear…

AUDUSD still looks soggy… there should be a test of the 0.8736 low before too long. I still prefer a dip all the way down to the 0.8578 weekly low again but again, fitting this into a structure is rather difficult. USDCAD… well, I was bullish but not that bullish on Friday. No real harm done as the larger picture does imply a high above the 1.0741 high so the approach should be to buy on dips…

Today’s free analysis is for AUDUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s Trader Package Review & Trade Set up report. (+155 pips)

Have a profitable week
Ian Copsey

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

Friday, May 14, 2010

The decline continued with shallow pullbacks … the risk maybe a recycling back to 1.3086…

The deeper pullback failed and losses resumed directly. This has provoked a new low but one achieved with shallow pullback along the way. I am not too concerned with the new low as it still fit into the larger picture and there’s even risk it could extend below 1.2500. However, while it doesn’t go too far – and 1.2475 would be my limit – then the risk is actually a total reversal and a return to the 1.3086 high. With USDCHF having stalled around the targets I would expect in a triangle the two together do seem to be working in tandem. I’ll even add GBPUSD … there is still downside risk back to the 1.4479 low, maybe minor breach but this too seems to be getting a bit stretched.

All round hourly momentum is not looking totally comfortable with the Dollar rally that we’ve seen and this tends to support the risk I’ve outlined. However, given the general circumstances surrounding yesterday’s move it will be foolish to fight any breaks of key resistances and doubly so if the divergences break – a factor that often actually accelerates the trend. I’ll stick with my cautious call for the recycle, but it’s best to be aware of the risks.

It’s worth noting that weekly Dollar bearish divergences are still intact but not really at a stage that they can’t be broken. It is a warning to heed but there’s little from daily momentum to suggest a massive reversal at this point.

USDJPY… continued its frustrating game of rally & pullback and is really beginning to stretch the imagination. The daily picture still seems more bullish than not but the progress being made is exceptionally reluctant. I still feel the way forward is to buy on dips but the number of twists and turns is more prolific than an Agatha Christie novel… However, as elsewhere I see room for EURJPY to turn itself back higher. The only additional twist that can occur here is that I don’t see this being a robust rally which considering the strength that may be possible if EURUSD recycles doesn’t really point to a firm USDJPY… Still be very careful here.

AUDUSD… very clouded – take care. USDCAD certainly looks as if it has found its low but there’s still a pullback to come before it can truly make upward progress…

Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+160 pips)

Have a great weekend
Ian Copsey

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

Thursday, May 13, 2010

The final outcome will depend on today’s developments

Yesterday was a partially successful day only. The Dollar did make some gains but nothing significant and the continued lack of a deep correction kept the bias towards a larger consolidation. However, the structure has become more complicated and I am seeing potential for the alternative more direct decline. It’s doubly complicated by the sheer lack of interest shown by USDCHF.

However, I am beginning to see potential for what may be a stronger push lower later today if we see any moderate pullback in the Dollar over Asian and European trading. This scenario would call for a retest of the 1.2530 EURUSD low – probably a breach by 20-30 pips - but then a pullback higher. If we get this type of development then once the pullback higher is complete the risk will be for a break down to new lows. If we see any other movement lacking in direction we could begin to see some stronger movement higher (in EURUSD) that would either mean a much longer sideways consolidation and well, maybe even a total reversal of the Dollar’s fortunes.

Further Dollar strength does seem to be implied by GBPUSD and therefore I am being pulled more in that direction. The situation in USDCHF is just less clear. If anything we could be seeing an ascending triangle develop or merely a sideways channel. Thus, this interim period may well help us determine the final outcome.

Now, one thing I have noticed this morning is that EURJPY seems to need a rally now. I don’t see this moving to new highs but certainly 300-350 pips from yesterday’s 116.55 low does seem possible if it can push above the 118.40 peak seen already… This does seem supported by USDJPY at least. It may have slowed to a pace befitting a pensioner with an age of 93 but while the 92.77 area can support that pensioner may just get past 94 before he takes a rest again.

AUDUSD appears locked in a short term sideways range – a triangle I think it will be – so look for breaks of range for the next move. Finally, USDCAD spent the day meandering but going nowhere. It is poised to break higher again I think and it’s more a matter of whether it sees one more dip or forces a more direct rally. The 1.2226-45 area seems the critical pivotal area.

Today’s free analysis is for USDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+75 pips)

Good luck
Ian Copsey

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

Wednesday, May 12, 2010

Yesterday’s moves are more in line with a larger sideways consolidation

Yesterday did see the Dollar make further headway against the continental Europeans and today I see just a bit more. The bigger question was whether these Dollar gains would imply a consolidation or a direct resumption of the larger rally. The biggest clue for me was the sheer lack of retracements of any size in EURUSD. This type of move tends to point to a corrective structure rather than a directional one. Equally USDCHF has continued to develop in tight erratic moves more attuned to a triangle that a directional move.

Therefore today should see the Dollar’s gains edge higher but stall around the 1.2530-50 area in EURUSD and 1.1179-09 USDCHF. The reaction higher in the former should be quite direct while USDCHF should continue to see tighter individual moves within the larger sideways consolidation.

Now, GBPUSD broke the mould here but this is in a slightly different structure. I can’t see that we’ve seen any larger reversal signal to the daily decline and thus it remains bearish overall. However, this looks like seeing its pullback higher become deeper before the downtrend can continue. What we probably need to do with this one is keep an eye on its continental brethren and work within that structure.

Next USDJPY… I’m just getting slightly frustrated with this one. I have held a more bullish outlook and I’m a bit reluctant to let that go right now but the lack of impetus on the upside has been a bit frustrating. Mix in with that the complication of EURJPY and I find it tough to get too bullish as well. However, quite what the structure basic is has become clouded. A sudden rush up in USDJPY and EURUSD would break the 122.28-48 resistance I have. Never say never – but until that breaks I feel there is more risk of consolidation… If that’s the case and we’re going to see EURUSD back at Monday’s highs then it’ll mean USDJPY will have to go lower.

Thus, just take care with this triangle relationship… something’s got to give somewhere soon…

AUDUSD… has come lower but not emphatically. I remain overall bearish but am a bit frustrated with the lack of follow-through lower. Early losses may be restricted to 0.8895-05 but as long as the pullback is not too deep I’ll prefer to remain bearish. USDCAD… probably one more dip before that begins to reverse higher I feel…

Today’s free analysis is for EURUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+130 pips)

Good luck
Ian Copsey

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

Tuesday, May 11, 2010

Yesterday’s moves haven’t convinced me that the Dollar has reversed yet

The market played safe by apparently squaring out or reducing the short Euro risk with the ECB promising to play hard ball. I was looking for some stronger confirmation of a larger reversal but frankly I didn’t really see any. It’s still possible but the retracement in EURUSD really needs to get above 1.3110 for the downtrend to look troubled.

What does confuse is USDCHF which broke below my favored support only to bounce from the 1.0923 pivot support. I’d wanted to suggest that break of 1.0978 would be bearish but there doesn’t appear to be a completed bullish structure yet. I’m therefore left hanging in limbo. However, the term limbo may well describe the possible development over the next 2 days or so. As an outline, if USDCHF goes into a triangle and EURUSD sees a sideways consolidation (may be a flat correction that remains below 1.3110) then it will herald a final dip by Friday or into early next week… This will be what I shall be looking for. GBPUSD may well follow the consolidation scenario also.

USDJPY… wasn’t as strong as I would have liked and I am also aware of the pullback in EURJPY which failed below the 122.48 resistance. This means we may just see USDJPY edge lower also and in that case I can’t rule out a modestly deep pullback. Only back above yesterday’s highs would maintain the upward momentum…

AUDUSD topped out perfectly in the 0.9070-80 area and this should be heading lower along with the European moves. USDCAD … may have completed its correction. This will require a little more care but I shall be expecting a second push higher before too long.

By-word for the day is caution …

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. (+170 pips)

Good luck
Ian Copsey

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

Monday, May 10, 2010

The EU announcement has forced the Dollar lower but I think we should still take care

So… the EU has a huge fund to protect the value of the Euro. Unsurprisingly this has forced the Euro higher this morning and it may seem as if the larger Dollar rally is complete. I do have a projection close to the 1.2518 low that would imply a major low. However, I’m really not convinced that we’re going to see direct gains. If I look at USDCHF, GBPUSD and even AUDUSD I can’t see that they’ve completed their depreciation against the Dollar. It does therefore imply that we still need to take gentle steps at this point.

There do seem to be quite clear reversal levels in all of them and therefore I shall detail these in the individual analyses today. However, until these are broken I still have a mild preference for the Dollar to resume its gains over the course of this week. However, these shouldn’t be direct and there could mostly be some range trading interspersed by sharper moves that may well be driven by announcements and further developments in the EU farce.

Before the Dollar does resume its uptrend I still suspect that we could see some additional strength in the Euro. This is where the larger risk lies as USDCHF and GBPUSD appear to have reached the limits for their respective corrections. This will mean that the Euro must make its moves unilaterally. Any unison in Dollar losses would place a bigger risk on the possibility of a larger Dollar reversal to the long term uptrend.

USDJPY rallied more directly than anticipated and may well be displaying a solid uptrend. Right now there seems to be risk for a sideways consolidation but all being well, once this completes the upside should resume. That should also drag EURJPY a little higher but assuming EURUSD reverses lower once it has completed it correction then downside will develop. I see the recovery in EURJPY as part of a daily correction and thus this should last a little while longer.

AUDUSD… close to its retracement target on this morning’s push higher – that still has downside risk towards the old 0.8578 corrective low.

USDCAD… played its usual “Loonie” self in breaking supports and therefore has more downside risk. However, in the larger picture I still see a second rally so we’re just going to have to bear up with the correction which, if this currency pair is true to form, could be pretty messy so take care.

Today’s free analysis is for AUDUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday's Trader Package Review & Trade Set up report. (+195 pips)

Have a profitable week
Ian Copsey

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

Friday, May 7, 2010

We haven’t seen the end of this panic yet… the only question is when extension will develop…

I turned on my PC, looked at my charts and then decided to call into my office to say that I had a headache and would stay at home. Then I realized my office is at home… No such relief for an analyst…

Frenetic, volatile and energetic are all descriptions of what occurred yesterday. I prefer the words crazy and screwed up… I have learned over the years to try and contain excessive forecasts as they tend to look stupid. However, when this happens I look stupid… Thank goodness the market doesn’t repeat this too frequently!

Scenarios got blown out of the water within minutes and there was no time to react. Needless to say the analysis this morning has been quite intense and I have attempted to discover the true structure of the moves but with the market as it is what I shall present really needs to be handled with care and make sure that you have good trade set-ups to support a trade.

The Euro is dead… long live the Euro. Well, not dead to be honest and I still feel there is a good chance of an end to this move over the next week or two. But let’s just say we’ll need a few things to happen to confirm this idea. Right now it’s very tough to fight the rabid bearishness. If I have any preference then we may just see follow-through again today but by nowhere near as crazy as yesterday. A correction is due I think but come next week the Dollar can resume its rally.

If I have identified the scrambled new structures correctly then there does seem to be a common theme across currencies of a due correction. The key will be identifying the completion and when the market resumes its panic.

There may be one exception in USDJPY. I feel there is a slim chance we may have seen a low here already – which will come to the relief of EURJPY which lost around about 8% of its value yesterday. I don’t think I have seen a daily move in my 28 years of markets which has registered much above 6%...

AUDUSD is in the same boat – a correction due but probably an attack close to the 0.8578 low. USDCAD was even stronger than expected and to be honest is a better target for this part of the wave structure. It risks some consolidation but new highs are expected here too…

Today’s free analysis is for USDCAD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report.

Have a relaxed and peaceful weekend
Ian Copsey

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

Thursday, May 6, 2010

Dollar bullish momentum is really threatening any possible reversal

The 1.2935 support valiantly held the front line attack for some while yesterday but almost inevitably it finally caved in and allowed the marauding Dollar to extend its inexorable climb... and then some… For a brief few hours the 1.3805 EURUSD low and 1.0086 USDCHF high had me wondering whether we had witness one of those final collapses in a spike low/high (and in Elliott terms a fifth wave extension.) It may still be possible but daily momentum is horribly Dollar bullish still and it’s only the weekly momentum that is clinging on to a Dollar bearish divergence. Having said that, there is some evidence to suggest that a time based reversal is due over the coming 1-2 weeks. However, even that time reversal implies there seems to be more gains to be seen…

I’d love to see a direct reversal now but there are significant mountains to climb and it does seem a remote possibility. However, just in case, keep that possibility in the back of your mind. If I can see any lower targets for EURUSD then there’s one around the 1.2671 area and if that breaks then the 1.2328 low does come to mind.

However, for today there are some short term signals that suggest a pullback but this could find a barrier in the 1.2905-35 EURUSD area and 1.1070-00 USDCHF area. As for GBPUSD – that too seems to require a pullback higher but further lows are possible here too although at this point I don’t think they’re going to be to below the 1.4782-02 lows.

Even USDJPY collapsed and still appears to have further to go. Key support appears to be the 92.74-81 area. This tends to fit in with EURJPY that still has larger downward pressure but while 119.85-95 supports a pullback is due first. Overall this does seem set to break below the 119.64 low.

AUDUSD held the 0.9019 support and likewise due a pullback but I suspect losses will eventually take us below the 0.9001 low – with two target support areas – at 0.8981 and favored at 0.8911. USDCAD may well spend the day consolidating or if it extends higher directly then look for 1.0482.

Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report (+155 pips).

Good luck
Ian Copsey

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

Wednesday, May 5, 2010

Yep… that was pretty direct…

That was painful… I opted for the non-direct gains and clearly got that 100% wrong. What’s more they developed in an almost straight line to cause momentum to pop out of the roof… Daily momentum in both EURUSD and USDCHF are still strong and this does cause a considerable amount of discomfort considering price reached within a slither of the targets at 1.2935-45 EURUSD and 1.1067 USDCHF.

Will they hold … or have I got this wrong given momentum has been so direct? Well, never say never. If I am correct then this is the final rally and that’s where spike tops occur but spikes are never a good thing to anticipate or trade. However, not everything is totally bullish. I can still see a wave structure that supports reversals at, or close to, those targets. There are weekly Dollar bearish divergences. An unusual time frame but the 8-hour charts also have Dollar bearish divergences. EURUSD could just cling on to a daily bullish if we see a decent recovery by the end of today.

So there are sufficient projection measurements and some momentum divergences to support a reversal. Price has now to confirm this. Equally, significant breaks of those resistance levels would open up a can of worms.

I should add that USDJPY, while not quite meeting the 95.20 target has reacted appropriately in a correction and that appears to be targeting the 96.02 projection which should trigger a moderately large correction. I’m also still not convinced that the decline from the 127.89 high in EURJPY can be described as a trending pattern. I’d say the same thing about AUDUSD. All these also appear, at the very least, to suggest a potential turn-around in fortunes.

USDCAD though does still seem to have further upside but a pullback should be due before too long.

Thus, today I think the safest route is to sit and observe. If you see clear Dollar bearish set ups – preferably through patterns – at the target levels then take them and consider the potential for spike reversals. Otherwise it’s tough to argue with short term momentum….

Today’s free analysis is for USDCHF and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report (+110 pips).

Good luck
Ian Copsey

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

Tuesday, May 4, 2010

Today should provide more information on whether Dollar gains will be direct…

I’m pretty satisfied with yesterday’s price development. The Dollar pushed higher to escape from the threat of the uptrend stalling and retains the targets I have been outlining. Now the question remains whether it will do so directly or whether we’ll see further consolidation before what I consider should be the final rally to what I consider could well be the Dollar highs for the year.

If I have any preference then it’s for consolidation. This seems to be the common risk across the three European currencies. Certainly, if GBPUSD goes down now it would threaten a stronger bearish move. That may not sound too critical but if it breaks below 1.5125 then it will be hard to retain the larger bullish structure. By rallying today within its consolidation range it can then allow a dip by tomorrow or Thursday as part of its corrective structure. This would then imply that EURUSD and USDCHF can spend that time consolidating also. This may even extend the downside target for EURUSD… but we’ll wait to see what occurs today.

USDJPY spent a long, long time making up its mind whether it wanted to push higher but held that 93.84 support firmly. It does still have further to go I think but I’m being forced to rein back on my very bullish target as it just doesn’t seem to have the legs for the higher 97.26 target and may not even get beyond the 96.02 area… In the meantime it looks as if it will find the 95.20 resistance a barrier and fall back into a correction.

With the combination of USDJPY being firm and as long as EURUSD rallies it should keep EURJPY supported but it hasn’t really displayed much enthusiasm for the upside. I feel it can make a little headway but may find the 125.87-92 area difficult to overcome.

AUDUSD failed to really provide any information about its intentions. I’m still in two minds here. In the larger picture it remains bullish and the only question in my mind is whether it will rally directly or see a deeper pullback first… However, keep in the back of your mind that it has always been bought on dips and I can’t see this changing for a while.

Finally, USDCAD… hanging on by its nails to a possible bullish structure. If it rallies I fancy it could well be strong else the risk is for it to drift back lower again iin its larger consolidation range.

Today’s free analysis is for EURUSD 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).

Good luck
Ian Copsey

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

Monday, May 3, 2010

The Dollar has reached critical supports … it should rally to targets … or completely collapse

In the end the Dollar didn’t go my way but as warned, the losses weren’t that strong either and even on open today following the Greek bailout package the follow-through was exceptionally mild and only reached the sort of support levels indicated on Friday.

So… will it rally again… or won’t it? Well, all I can say is that while this morning’s corrective lows hold the Dollar bullish structure remains in place and the structure so far from the 1.3691 EURUSD high and 1.0501 USDCHF low have been pretty close to expectations and therefore I’ll stick with it. For me the question is more whether it rallies to targets directly or whether it develops in a more complicated way. Frankly either way the Dollar should rally today and we’re just going to have to assess the manner of the rally to get an idea of which alternative it will take…

USDJPY also looks to be in the same boat. That didn’t quite develop as expected with the pullback from the 94.57 high but while it remains above this morning’s 93.84 low I remain cautiously bullish but if that is the case the rally should be quite firm as I feel too that this is a last rally in the part of the upward structure which maybe has potential to edge above 97.00…

That should keep EURJPY under a more consolidative influence but with the possibility that one may lead the other – and if that’s USDJPY then there could still be some ticks higher first. Bear in mind though that Japan has public holidays for the first 3 days of this week…

GBPUSD… I’m more confident that we’re in a sideways consolidation and don’t think we’re going to see a break of the 1.5125 low of 1.5523 high just yet. However, whether it goes up-and-down or-down-and-up is less clear. Given the Euro is expected to decline I think maybe the downside is more likely but should ideally lag the Euro.

Finally… AUDUSD… the 0.9218-20 lows this morning provide the critical support. While it holds we can still see gains else expect this to follow the Euro also. USDCAD may well make marginal new highs but I don’t expect any runaway gains.

Today’s free analysis is for USDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s Trader Package Review & Trade Set up report (+50 pips).

Have a profitable week
Ian Copsey

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