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HARMONIC ELLIOTT WAVE

Thursday, June 10, 2010

All being well, this should now see EURUSD decline to target

EURUSD continued its pullback (thought just a little higher than expected) and USDCHF made its low below 1.1426 which were the requirements for the final Dollar rally against the Euro and possibly the Pound too. The lower low in USDCHF confirms the 1.1730 high as the final high so this pullback, while it will probably be deep, should not break above 1.1730…

I have also been dabbling with the DJIA which has been moving in tandem with EURUSD and which has a probable target around 9,530-50 and at most 9,330-35. This should spark a solid recovery and thus does seem to correlate quite nicely. Everyone seems to be bearish here so should trigger some solid short covering.

So for today and what could now be into tomorrow, we’re going to have to concentrate on the move lower in EURUSD and try and identify the pullbacks. This should see a brief low around the old 1.1877 low before it can follow-through lower so this is where some delay may occur. It seems as if GBPUSD is going to follow-suit. I still have some larger reservations on this but for today I think we can apply the same approach as we should with its European (at-arms-length) compatriots.

USDJPY… this does seem on the soft side but may just hold to a range for much of the day but I suspect an eventual break lower now. This should still be within the larger range so I don’t expect new lows below 88.97. Part of the reasoning here is linked to EURJPY. Its deeper pullback yesterday seems to beg a spike decline to its target. The decline in EURUSD doesn’t appear to be enough and will require USDJPY to move down also. However, EURJPY is in a similar area of its own wave structure as EURUSD and should probably hold the 107.80-108.10 area on the first decline. It is therefore the second drop that will probably require the frenetic nature of a spike decline. Keep this in mind as all three pairs develop.

AUDUSD seems to be a crazy mixed up kid at the moment but overall I still see this in a sideways consolidation within which we are probably around the central zone. I am bearish overall so keep that in mind but I’m not sure this is going to move in tandem with the others.

USDCAD is not just crazy & mixed up it almost looks like its on speed… The general erratic development needs to begin to map out some decent relationships in order to identify the pattern here…

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. (+80 pips)

Good luck
Ian Copsey

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

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