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HARMONIC ELLIOTT WAVE

Tuesday, May 10, 2011

The Euro low looks to be in place…

The Euro performed well, also the Pound too, but the overall outcome seems rather mixed. USDCHF didn’t manage a new high while USDJPY decided to up tools and go on strike. There doesn’t appear to be a convergence of targets being met which seems to leave the Dollar in a mire of vagueness and indecision. Perhaps not the Dollar as such but the market in general. Or maybe it’s just me…

This morning’s analysis provided some fairly strong views for most currency pairs in general. If there is any confluence of expectations it is that we should see some Dollar weakness but I can’t see this developing too far and may well be just part of a correction in some pairs. This even applies to EURUSD to a certain extent as it does seem close to an initial stalling area for a correction lower.

One that did raise a lot of question marks was GBPUSD. It reached the deeper of the targets I had been considering but only for a pullback. The natural target for the first move after the 1.6745 high has not really been achieved but the correction (in this case) should be shallow in this instance but already it is pressing the deeper of retracement ratios. For me to keep this larger structure it needs to move sideways for a while else it could begin to imply that this decline will be much briefer than I had anticipated.

However, at this point I have difficulty in accepting this Dollar rally as anywhere close to complete. The decline in USDJPY appears corrective, as does EURJPY, so my outlook does appear to require another more uniform bullish Dollar correction once the Euro has managed its own pullback…

I’m not sure whether the above description of what’s going on in my mind actually makes much sense other than some rambling. Maybe so, as I do find a lot of conflict in the current situation, but bottom line does appear to suggest a period of rather sketchy, possible non correlated moves so I would suggest a great deal of caution until some clarity appears…

Today’s free analysis is for EURJPY 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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