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HARMONIC ELLIOTT WAVE

Friday, March 11, 2011

Another correction due in the Dollar…

Mostly everything went basically to expectation yesterday, some targets meet quite accurately but one or two taking a slightly different route, although in the right direction. Overall the Dollar correction higher is developing in a manner I would expect and this remains the underlying direction and should last into next week – if it gets more complex then it may take until late next week. So just keep in mind that for the moment the better trades are those looking for the Dollar upside.

Yesterday’s push higher is close to initial target areas and should provoke a correction over the course of today to bring us about half way through the entire corrective process. Given we have a weekend there is even risk that this correction could develop in a more complex and choppy manner. Therefore the potential for flat corrections, triangles and even a correction that could generate a marginal new Dollar high and a recycling are also structures to watch out for.

I feel the Europeans are still fairly straight forward except for USDCHF that appears to have taken a sideways consolidation route already. That consolidation should be set to continue while EURUSD and GBPUSD find supports for a correction higher.

I do feel USDJPY is worth a special mention here along with EURJPY… The cross slipped to 5 points below the support I have been outlining. On the face of things this should recover. It will help that EURUSD should retrace higher so what is also needed is for USDJPY to extend higher a lot more efficiently than it did yesterday… It’s performance was slightly disappointing and should be of growing concern as to whether the cross can really extend as high as I’ve been saying. Never-the-less, while yesterday’s low holds the risk can still be for a move above 115.98 but this needs to develop quickly by the look of things else we could begin to see a stronger decline…

Today’s free analysis is for USDCAD and can be found on http://www.fx-forecaster.com/DailyForecast.html.

Have a great weekend
Ian Copsey

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