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HARMONIC ELLIOTT WAVE

Thursday, December 9, 2010

This market looks a bit like my daughter’s bedroom…

Yep, you’ve got it… One hell of a mess…

The more I look at what’s happening the more I have to look in the thesaurus for words that mean, messy, erratic, complex, muddled, cluttered, chaotic, confused, disheveled, disorganized, muddled, slapdash, untidy, unkempt, disorderly, sloppy, slipshod and bedraggled…

Perhaps I should basically suggest that today should be up and down but leave you to guess which comes first. In some cases it does look like a flip of the coin will do. Well, I do have a view and I’m quietly confident of it, but this is one of those markets where we need to be aware of minor breaches and quick reversal where stops could easily be triggered.

However, the common risk I see across most of the currency pairs is basically Dollar bullish followed by a reversal lower. If I am to choose a second ranked risk then it’s still Dollar bullish followed by consolidation. Obviously the last will just cover all eventualities – Dollar bearish and then bullish… However, if the final alternative occurs then we may well be seeing a more directional move… However, the first option remains my favored outcome but I do feel we have to go through this whippy move higher first…

If there is any pair that may escape this pattern it could be USDJPY. I doubt it as I feel we need a deeper correction first before it can go back to retest and probably break the 84.39 high. Don’t get too carried away with the prospect of a sustained rally though.

A last note on EURJPY… It has come to a point where there may be a final push higher but it’s approaching key resistance levels. This may be a product of USDJPY pushing higher but frankly, given the level of the anticipated whippy moves I’d rather concentrate on price in each currency pair. Once this high in EURJPY is in the risk is lower but will probably have a slow start which means in the slightly larger picture we’re still talking range trading to a certain degree.

Treat each trade as short term, take profits early…

Today’s free analysis is for USDJPY and can be found on http://www.fx-forecaster.com/DailyForecast.html along with yesterday’s Trader Package Review & Trade Set up report. (+30 pips)

Good luck
Ian Copsey

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

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