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HARMONIC ELLIOTT WAVE

Friday, August 27, 2010

What I thought would happen yesterday should happen today…

Yesterday is a day I’d rather forget. While there were a few decent calls the main directional moves in EURUSD & GBPUSD were 180 degrees wrong. I was particularly surprised with the depth of the pullback in EURUSD which, while not penetrating the 1.2771 resistance was very deep for the structure I have been contemplating.

Never-the-less, after a study of the structures I still remain bearish for these two although the eventual downside targets have been reined in. What’s more, GBPUSD appears to be closer to its low on this decline compared to EURUSD. Combine this with the extension in USDCHF and we have quite a mixed bag of potentially conflicting structures across the Europeans.

What it does boil down to is: today should see the downside in EURUSD and GBPUSD resume and should quite quickly retest the old lows but probably not extend lower before a pullback. It seems more likely that we’ll see the final lows early next week. For those of you interested there also appears to be a major low in the Dow Jones Industrial Average early next week too that should cause quite a rally.

As for USDCHF I am more confident of the final target now, the one I have been banging the drum about for some while though today should only see a minor new low before a pullback, possibly occurring early in the day before the larger declines in the other European pair really get on their way.

USDJPY… whew… I’m not really excited about the manner of the rally. It may just be one of those ratchety, erratic moves as I still feel there is a little more to go but as yet there has been no strong sign of a reversal and until that happens we have to be aware of one more dip…

What is much clearer is EURJPY which was probably the best bit of analysis on the day. I had hoped the rest of the move to 108.00 would have been faster but the resistance was perfect and does now imply losses. This should, for the most part, be driven by EURUSD but given the shakiness of the rally take care in USDJPY also…

AUDUSD saw a deep correction also but I think I’ve sorted that one out too – should also have a bearish day. USDCAD most probably saw its low. There is a minor risk of a new marginal one but before long this should extend its rally. I would prefer if this occurs directly…

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)

Have a great weekend.
Ian Copsey

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

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