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HARMONIC ELLIOTT WAVE

Friday, June 4, 2010

USDJPY should continue its push higher while more care is required for the Europeans

Yesterday was always going to be tough. I’m not really sure it’s going to change today. Being the day when the market gets its monthly caffeine injection through the non farm payrolls it often means that the market will be reluctant to push the Dollar through any significant support of resistance. That said, in the Europeans that leaves quite a wide trading range to go for…

At first glance EURUSD and GBPUSD look as if they may even be developing triangles which would keep things pretty tight until early next week while USDCHF is presently doing a fairly decent impression of lying quietly in a morgue. The upshot of this perception is that Dollar-Europe remains in a corrective pattern and that implies choppy, erratic and inconsistent. It should allow EURUSD and GBPUSD to recover within their ranges and for USDCHF to turn a whiter shade of gray.

The larger picture does of course remain Dollar bullish and that should be kept in mind but do be aware that there are still a few hurdles to overcome before that uptrend can be said to have resumed. A new low around 1.2066-96 in EURUSD is not impossible and yet still see a reversal higher. If it gets much beyond there, and USDCHF rises from the grave and breaks to new highs then we’ll be seeing greater strength.

USDJPY… rallied well and still seems to have legs to follow-through. I think we’ll have to take care as it approaches the 93.53-63 area though… Now, perhaps the one to watch in all this is EURJPY. It has calmly recovering and has completed two-thirds of its correction. It still has a little way to go and shouldn’t get to its 115+ target directly but this could be the signal for EURUSD to resume its bungee jump…

As long as AUDUSD can break above yesterday’s high it can also continue its correction higher but still within the larger bearish structure. USDCAD still seems to have further downside to go…

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)

Have a great weekend
Ian Copsey

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

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