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HARMONIC ELLIOTT WAVE

Tuesday, August 3, 2010

Still just a bit further to go…

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


This final part of the decline has become discombobulated… The elaborate description of how the four majors should develop was torn apart by what actually happened. GBPUSD led the way in a rampant, runaway rally while the others stood and watched. EURUSD finally made a break to try and catch up but USDCHF and USDJPY really found it hard to work out what all the fuss was about…

However, the end does appear to have come closer to the near horizon so it should be more a matter of time and patience. EURUSD in particular seems to be just one more leg higher away from my long held target but USDCHF, while the deeper targets are still valid, does raise some question over its enthusiasm and indeed ability to get much beyond the higher target. If I have any questions to ask of price action then it is in the intraday momentum picture which does seem to have been stretched to the point where Dollar bullish divergences are under pressure…

So while I am still overall satisfied with the progress there are still one or two areas which I still feel require some due care & attention. Just as GBPUSD has extended its rally far beyond expectations there does also seem to be risk of USDCHF and USDJPY falling short of targets. If we approach them without good Dollar bullish divergences it would add to the concern.

We should start the day with the usual caution in Asian trading and probably see the pullbacks from yesterday’s Dollar lows deepening just slightly. Then we need observe the second half of the day and concentrate on the potential move to targets. Ideally we should see the turns today with the only risk being a longer sideways consolidation – though still quite shallow.

One more concern is AUDUSD which appears to be pointing to a deeper upside target, but even here an initial correction appears due. However, USDAD seems in line with the approach to its target.

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. (+55 pips)

Good luck
Ian Copsey

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

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