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HARMONIC ELLIOTT WAVE

Monday, July 26, 2010

I can’t see much change in the status quo…

Please note that The Daily Forecaster will be taking its summer break from the 9th-13th August


Today is meant to be interesting from a timing perspective. It is a full moon day, a Gann date and also indicated by other timing methods as a key moment when a larger reaction is due. I have been bearish Dollars for some while now but of course for me the key is whether targets have been met and whether momentum supports a reversal. However, from this perspective I have my doubts although I have to say that the reversal signals are beginning to appear but not uniformly.

In the daily chart EURUSD has made what I term as a “standard” retracement level – one from where many corrections stall. I had felt EURUSD was due a slightly deeper correction though. Daily momentum hasn’t generated a bearish divergence but it is close…

USDCHF has not met target but does have a bullish divergence. GBPUSD… well, targets are difficult to quantify here though it has failed just below the key daily swing high at 1.5523 and does have a bearish divergence. USDJPY hasn’t met my target at the old 84.82 low but is in a weekly structure that could make up rules as it goes… However, there is a daily bullish divergence. That makes three out of the four major currencies showing slowing Dollar bearish momentum.

I think what we can say is that the threat is definitely present and as we move forward from this point we have to acknowledge that a reversal can occur at any time.

However, if anything Friday’s price action appears to work in nicely with my adjustment to a holding pattern which would be a precursor to a final dip in the Dollar. In other words, I am anticipating a resumption of Dollar gains and it’s more a matter of “when” rather than “if” in my mind and I am still more biased towards a final extension of the current move rather than an immediate reversal.

Therefore, I feel that this week we should alter our approach slightly by adding a bit more caution and being aware of the reversal risks. For now I remain neutral until the current holding pattern is complete and probably then for the final push lower… However, keep one eye over your shoulder from this point forward.

Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with Friday’s Trader Package Review & Trade Set up report. (+40 pips)

Have a profitable week
Ian Copsey

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

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