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HARMONIC ELLIOTT WAVE

Wednesday, April 27, 2011

Further losses to come…

In the end the Dollar made the extra leg higher to meet the resistance levels I highlighted on Monday in GBPUSD, EURUSD and also point-perfectly in AUDUSD. That brings greater confidence in the structure I have been observing and this should lead to further Dollar losses over today. GBPUSD is a little behind the other two but I’m quite comfortable with this since it has a closer final target. It seems likely we shall hit the penultimate target later today – may just last into tomorrow but it will have to make hard labor to slow down.

So, this next Dollar low should cause a pullback, and probably a decent size one, lasting into Friday at least and possibly into early next. If it really slows down in the final leg then it will really highlight the fact that we are approaching a key Dollar low that should trigger a correction lasting around 2 months.

I’m also eying the U.S. indices which are on the brink of confirming their own rally to a very significant peak and the fact that there has been a broad correlation between the Dollar losses and the gains in equities makes the prospect of a joint turn quite palatable.

A word on USDJPY: I was quite satisfied with its movement yesterday and does, at last, appear to be making some sense. This has a little way to go on the downside – and I mean little over today but that too is due a pullback. The nature of the pullback could be crucial in identifying the nature of the decline – does it imply new lows or has this been just a correction? With the Dollar expected to be strong over the next 2 months I suspect the latter.

So… keep you eyes on the Dollar downtrend and watch for the target areas to be achieved, particularly in EURUSD, GBPUSD and AUDUSD which do seem to be working well within the structure I have…

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

Good luck
Ian Copsey

HARMONIC ELLIOTT WAVE FORECASTS NOW AVAILABLE FOR U.S. INDICES

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