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HARMONIC ELLIOTT WAVE

Thursday, September 9, 2010

I still look for losses to develop across the board…

Actually, I mean that… It’s not something I like to call – that all four major currencies look bearish – but they do. The only one where I could accept a slightly deeper rally is USDCHF but it’s not my favored view… So perhaps the ideal trades to look out for that should provide greater value for money are the crosses… and yes, EURJPY looks very bearish as should GBPJPY.

Individually I feel USDJPY has the more limited downside. Following the sharp drop from the 85.22 high it was always going to be difficult identifying key levels as straight line drops tend to hide the projection levels. However, overall it does still seem to be in line with the targets I have been mentioning and all being well we should see hourly & 4-hour momentum develop some bullish divergences.

This will mean that EURUSD (and probably GBPUSD now) are more likely to see sustained declines that should drop to new lows in this move. While it’s obviously not my preferred view, if the declines do not develop strongly and begin to move back higher to break yesterday’s highs I will have to admit a deeper concern for either extended sideways consolidation or perhaps even a complete reversal in my underlying Dollar bullish outlook.

USDCHF has frustrated me a lot over the past few weeks by maintaining a stubborn bearish trend. Yesterday made further progress but while yesterday’s high holds the outlook does still look bearish for just a little more. As with USDJPY I am not quite so bearish here.

AUDUSD… I’d actually like to see a minor follow-through higher but feel this is due either a pullback, perhaps in the form of a recycling of the correction or just a resumption of losses in the intermediate term. USDCAD reversed nicely lower. There’s still a question mark over whether a marginal new low will be seen but I prefer it but here the day should see a correction higher.

Today’s free analysis is for GBPUSD and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+15 pips)

Good luck.
Ian Copsey

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

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