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HARMONIC ELLIOTT WAVE

Thursday, June 30, 2011

Just a little further to go and we should start seeing Dollar strength…

Well, yesterday was an interesting day and provided some good information about the near term and probably for the coming week at least. The more direct rally in EURUSD wasn’t quite was I had originally expected but was actually quite healthy and has clarified a few things. The bottom line is that we’re now close to a Dollar low – probably one more high before a larger reversal lower.

This is also confirmed in GBPUSD which is probably even closer to its own high from where we should see the next leg lower. I suspect this has more profit potential than the other Europeans and appears to have a stronger structure to follow. By this I mean it is in a trending structure rather than corrective which appears to be the case in EURUSD and USDCHF. The latter has probably fought off the test of that 0.8273 support I have identified for some while. We’re not completely out of the woods but given the Dollar bullish expectation I feel this is the stronger structure…

Also interesting was the deeper pullback in USDJPY… I had wondered whether this will force losses but more likely I had made a misjudgment in the rally mainly due to my reluctance to be too bullish. As long as yesterday’s low remains intact this still has a bullish outcome and one that is stronger than I had anticipated. That one’s still touch and go, so we’ll have to see how today develops.

The correlating point about USDJPY is EURJPY which does still seem to have further gains to be made. I suspect in the near term these may well be limited and instead we’ll get a deeper correction lower, but the underlying structure does have quite strong bullish ratios and projections as long as certain support levels hold.

Elsewhere USDCAD appears to have confirmed a major high and should head lower… The Aussie … I think that’s pretty much in the same boat as the Europeans and assuming this doesn’t break above the 1.0715 high by too much the implication will be quite bearish and for new lows.

Good luck
Ian Copsey

Wednesday, June 29, 2011

Mazes, short cuts, long cuts, reversals, whipsaws, chainsaws and hara kire

It seems like the market’s passion for selling Euro has been cut short. It reached the low-end of my day’s target which was pleasing and USDCHF to 2 points above my critical support level and then a bounce. So… what next? If USDCHF break below yesterday’s low which will indicate further losses, will EURUSD continue its rally? Probably... But will that happen today? I doubt it…

The market doesn’t appear to be in a mood to push the limits right now – on either side of the market. Continued Dollar losses just doesn’t seem to be something that could be stomached at this point… The indications I see is that we should see the Dollar recover today and probably approach the levels that would provide the line between bullish & bearish. Then we’ll see whether the market’s guts have the appetite for a break…

GBPUSD appears to be a slightly different proposition with the developments over the past few days not quite going my way. I do remain with a more bearish view but also a slight hesitancy as to whether it can rummage up any energy for a deeper correction or just plain succumb to the downside again. Take care with this one but be aware of the downside still.

All this dilly dallying and procrastination over the Europeans appears to have prodded sudden interest in USDJPY which provided another day of decent strength and it doesn’t look done yet. However, I have to be just a little cautious here as if EURJPY has found a high – at least for now. Both USDJPY and the cross are both at quite important crossroads that apparently justify going straight across… but the timing may be different. As I mentioned, the cross seems to require a pullback which is likely to be driven by EURUSD. However, USDJPY was a touch stronger than expected and I feel could well see further gains today. The interesting point – if I have read this correctly – is that any pullback from the next high would be very shallow and signal higher still. This should develop over the next 2 days if it’s to happen at all…

So, take it easy today. As long as USDJPY rallies and you’re prepared to weather the shallow pullback this seems to have the greater potential today. Elsewhere it looks like we should be favoring the Dollar upside against the Europeans too. However, I’m not sure there’s a home run there… with the only possible exception being GBPUSD – but wait for that to confirm itself…

Good luck
Ian Copsey

Tuesday, June 28, 2011

Twists, turns, alleyways and dead ends…

It is obviously very apparent that the market has no real desire to push the Dollar anywhere particularly quickly or with any strong intent other than not making a decision. That’s a sentence that describes corrective markets…

Yesterday’s recovery in EURUSD and indeed, GBPUSD came as a bit of a surprise and certainly takes the sparkle off the Dollar bullish side. At the same time it opens up a greater variety of potential corrective patterns which will make life much tougher when trying to work out the structures in each currency pair while at the same time holding loose correlation. Overall, if what I feel is happening develops it could extend this period of confusion for another 2 weeks or so. Therefore it’s a period to retain an open mind and be prepared to alter views and direction as price develops.

Certainly for today there looks to be further room for Dollar losses against the European although I feel within recognizable boundaries. Once the sort of targets I have in mind are attained there should be a fairly solid pullback which should begin by tomorrow at the latest. This pullback should allow GBPUSD to make new lows.

The bigger story appears to be USDJPY which ploughed a firm bullish tone throughout yesterday and does still seem destined for higher levels. I’m rather mixed on how high this will eventually move but I wouldn’t be particularly surprised to see it as high as 83.50-00…

This also has impact on EURJPY which naturally tagged along with one hand on the USDJPY shirt tail and the other on the EURUSD. The implication does appear bullish for now but I suspect a choppy ride overall over the coming week or two.

However, the bottom line is… we are still within some complex developments which will almost certainly spring further surprises over the coming days. Thus, remain flexible and take profits early.

Good luck
Ian Copsey

Monday, June 27, 2011

I feel the Dollar needs to start pushing higher… but not so sure whether it will be direct…

I can’t say Friday has much of a theme. If anything, perhaps it was a slightly softer Dollar but hardly uniform or convincing. Overall I still have the view that the Dollar appears more likely to see gains in spite of USDJPY dipping lower. I have been more definite in this respect in GBPUSD and that hasn’t changed but there are signs that the losses in USDCHF are becoming a bit stretched, indeed even presenting us with a bullish divergence. What does bug me more than the others is EURUSD which has a rather perplexing structure in which the recent moves appear difficult to slot into the larger picture.

This forced me to spend some time looking over EURUSD this morning and frankly it is very indecisive… I am able to accept losses in the medium term picture but if these losses develop directly it does seem to complicate matters as it would appear to imply quite solid losses. I’m not really keen on this right now. My long term view is still for significant losses in USDJPY, USDCHF and GBPUSD. However, it’s hard for me to accept significant losses in EURUSD right at this moment. Later maybe, but right now, if I am correct on the Dollar elsewhere then the Euro downside should be moderately limited.

So for today I am continuing to take a more cautious approach, looking for more information in EURUSD in particular. There is still potential for USDCHF to make a last dip, although it’s not a certainty, and this could be extended to GBPUSD. However, both appear more aligned to seeing the Dollar making gains.

Equally, USDCAD seems still to be looking for another high and AUDUSD probably on the softer side. Thus, these seem to confirm US$ gains. EURJPY… I have no real expectations as it remains locked in a rather complex and ragged period of range trading and something needs to give in either USDJPY or EURUSD to shift the cross more convincingly.

Have a profitable week
Ian Copsey

Friday, June 24, 2011

I’m just not convinced about much at the moment…

…except perhaps GBPUSD…

Now, GBPUSD does look bearish. It’s got a little more room for a bounce today but don’t blink too often as the risk is lower and I still feel towards the upper mid 1.50’s at least. The key here will be spotting the right stalling areas on pullbacks to take advantage with any risk being potential complicated corrections or recycling…

Elsewhere? Well….. Heck, I’m just not convinced just yet. EURUSD did drop quite a bit but from what I’ve seen, if it does go down then it’ll do it in style and I’m not quite ready to contemplate that at the current moment. I could possibly be convinced but I’ll wait for it to happen first. USDCHF, as much as it started its charge higher with gusto, failed just short of the first hurdle. I fancy it may manage it before long but I feel it could well retest the 0.8326 low first. In the meantime we’ll have to see how EURUSD reacts today.

Even USDJPY disappointed in some respects. It broke above the 80.47 resistance and stalled just 3 pips below the 80.67… then broke but couldn’t sustain the rally. It does sorely need to scramble back higher quickly else its support will buckle under the weight. The same could be said of EURJPY which still remains in the larger range, continuing one of its characteristic chop-and-change formations…

So, probably the stronger structure is in GBPUSD right now and perhaps this should be favored while the others take time to brush off the confusion and make their stance with more clarity.

Have a great weekend
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Thursday, June 23, 2011

There are early signs of the Dollar looking to recover… but hang tight…

Yesterday’s drop in GBPUSD may well be a signal to drag the rest of the world into buying Dollars. However, I think jumping in right at this point is probably a little too late. While it has quite bearish implications it should be due a correction before it can make further headway. Keep in mind that this does seem to imply a target in the mid 1.50’s so the downside risk is quite attractive.

There is now a bearish divergence in EURUSD… but will it go down directly? Well, I won’t rule it out but I tend to fancy a push to one more high perhaps… It is resting on key support so it’s a bit touch and go. The reason I wonder about the potential for a push higher in EURUSD (although it could be just a correction) is that USDCHF would make a much nicer structure if it could retest close to the 0.8326 low… even a touch below would be ok. It’s just a matter of whether the moves between USDCHF and EURUSD will be correlated.

Besides, if GBPUSD does correct higher I feel a fairly deep correction may well be appropriate for the subsequent projection lower. Thus, today is a day for acknowledging the potential for resurgent Dollar strength but also waiting for that to be confirmed in case the pullback does develop…

USDJPY … very clearly range bound and has spent the third day in a row between 80.00 and 80.36… This morning has seen a minor break above and we’re close to key resistance so now the question is whether this, too, can take advantage and also push higher…From what I can see there’s a good argument for it…

In turn this can have impact on EURJPY … so be prepared to be nimble here also…

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Wednesday, June 22, 2011

It looks like life is becoming a little more complicated…

After yesterday’s developments I am left to the conclusion that the market is just not ready to push the extremes. This is where the structures begin to develop a duality that needs to be resolved by observing the wave relationships but can actually leave us hanging in mid-air for a while as the larger market energies consolidate before making a final decision.

In short that implies a certain amount of confusion…

I have two basic approaches in mind, though there could be more, but should be distinguishable through the manner of how direct the current Dollar weakness develops. However, that does provide a brief clue – that the basic direction for now is Dollar bearish – and it’s just how far this moves and how direct that will hopefully provide clarity to the outcome.

Given the propensity for sudden whipsaws at these moments the general rule should be to keep positions conservative and to ensure both money management stops and trailing stops are employed.

The only place I see potential is in EURJPY which appears to want to push higher. USDJPY has had a great reluctance to extend its losses and yesterday’s rally in the cross has raised the possibility of a second look at the 117.89 high… Therefore, as long as supports hold this does seem to be the one market capable of seeing a more directional move...

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Tuesday, June 21, 2011

Yesterday’s lack of sustained Dollar gains is just a little concerning…

The day started reasonably well. The Dollar attempted to renew pressure on the upside but couldn’t really sustain that pressure. I’m not going to change my view at the moment but will register a red flag… My basic thoughts are that there remains a potential for a minor new corrective Dollar low which, as long as it’s not too deep, could still allow the upside to resume. However, if those losses extend too far it could well tip the balance in favor of renewed losses…

So right at the start of the day there’s a small tug-of-war in place that needs to be monitored. This is pretty much a common theme across the Dollar-currencies so be prepared to act when key levels break.

The larger picture is one of a broad pivotal moment. My Dollar cycles are bearish to the end of the year. However, the problem with these cycles is they are not pinpoint and thus a reversal can occur within 6-9 bars of the cycle low. Given we’re already in that window there is a need to be alert. The stronger cycles are in USDCHF and USDJPY and given these have both seen new multi-year lows it’s not impossible that we have seen the final lows.

However, I feel that momentum conditions aren’t quite right for the reversal right now. That does therefore leave a window open for losses to resume. It’s just a matter of when and at from what area.

Thus, today isn’t a day for establishing sizeable positions but more one to identify short term opportunities while being aware of the larger structure.

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Monday, June 20, 2011

The strongest indication still appears to be for Dollar gains…

I left you with the expectation that we weren’t far off a Dollar low. In fact we had already seen the low and therefore the majority of last week generated gains. Having just gotten back in the seat again I need to get a greater sense of structure so will be rather conservative today to get a better sense of the energies around.

If I merely take the judgment that the rally in EURUSD developed in a corrective manner then it does imply a new low. From that perspective I feel the high seen on Friday probably provides the deepest we should see and thus the downside should develop directly. Now, if I have got this correct it should imply that we should see two more pushes lower to reach the target for this move. Equally this should apply in GBPUSD and in a different way in USDHF. However, I do have a slight conflict as the correction higher in the Swissie still seems to imply what should still be comparatively stronger gains compared to the other Europeans. Just keep that one in mind.

The pullback in USDJPY was limited with losses having made it down to the 79.56-69 lows… There is room for a correction on the upside. However, if I look at the bigger picture there appears to be a disconnection between the much larger downside risk and the limited movement seen until now. This gives me a slight sense of unease. Therefore I’m very mixed on this one. The EURJPY cross may well help us out on this as the daily structure is shaping up for a larger fall. This needs to get its skates on otherwise there’s a chance we could just go right back into range. Therefore, keep your eyes open on what this cross does as I feel it will be the clue for USDJPY…

USDCAD is looking more bearish. AUDUSD… I’m mixed there and would like more development to get a better feel…

Have a great week
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Wednesday, June 8, 2011

The Dollar still looks set to lose out…

PLEASE NOTE DUE TO OVERSEAS TRAVEL THERE WILL BE NO UPDATE UNTIL 20TH JUNE


Well the Dollar still remains under pressure with both EURUSD and GBPUSD seeing further gains, the latter not really expected, but it does still point to the market’s general dislike in possessing any Greenbacks. I still think it looks set to extend those losses again today as long as any corrections are limited. It’s still early days in the current structure I am looking at so plenty can still go wrong but the implication does look as bullish as I’d like it to be. It’s just a matter of the structure holding together.

USDCHF was rather flat and this may well buck the trend of the other two European buddies. My preference is still for a little firmer pullback higher but this would still be within the confines of a bearish structure so I’m not about to get overly bullish here. However, the position of this pullback is one which has not strong guideline for retracement ratios so at all times be aware that the downtrend can resume.

USDJPY has a quiet day, holding below my resistance yesterday and this still points lower. The extent of this current move is a little uncertain but it should move below the 79.97 low at the very least and a half-chance of even testing the 79.56 low… The combination of a bullish EURUSD and bearish USDJPY still looks to keep the EURJPY cross subdued. I remain highly wary of this pair as it has the tendency to work through some horrendous corrective structures and this one has strong potential to remain subdued for some while yet.

That does leave much else to say except just to cover AUDUSD – it was weaker than I had wanted and it’ll mean some care needs to be exercised but as long as it can break above the recent highs it could be the day’s stronger performer. USDCAD still hanging around. I am still basically bearish but with a slightly ambiguous situation which could still see one more high, but could just as easily resume the downtrend…

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

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Tuesday, June 7, 2011

The market has calmed down after Friday but will the Dollar extend losses?

Well it should against the Yen… That downtrend, as slow and jagged as it may be, remains intact and does seem to point lower still. We could even find this breaking below the 79.56 low so be prepared for a possible test. Given that EURJPY has been making hard work of the upside it wouldn’t take too much to knock it off its perch. However, that remains in a firm, if unpleasant, consolidation the structure of which really hasn’t yet made itself known. Until it does it’s probably best not to place too much risk on this pair.

So what about the Europeans? GBPUSD stalled early and EURUSD didn’t exactly set the market alight. I still find the latter has a very mixed structure and I am a little concerned over whether this is developing as I had wanted. We are at a stage in the larger picture which looks critical. It still needs to build a base for a larger and more substantial rally but there are some signs of the current move potentially generating a corrective pattern rather than a trending one. The conflict is significant. A corrective structure would imply new lows, a trending structure would imply the opposite – a correction but then strong, strong gains. We need to wait and watch with care.

However, in both EURUSD and USDCHF I cannot see any strong reversal signals that will completely reverse the weekly Dollar downtrend…

I actually still favor gains in both EURUSD and USDCHF, though the break level in the former is quite close. For GBPUSD I remain open as it really hasn’t aggressively extended the losses seen last week. This tends to bode well*overall but there’s still some potential short term weakness while the market remains subdued.

I still have a mild preference for AUDUSD gains and also USDCAD which tends to sum up the market right now as there seems limited correlation across the Dollar-currency pairs. Thus it is probably best to take things carefully until this sorts itself out.

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

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Monday, June 6, 2011

Friday was more remarkable than I had expected…

I had a good shout when EURUSD reached 1.4529 and dipped… perfect I thought… but that didn’t last long. So the Dollar has extended its losses more than I had expected in this leg. USDCHF moved to the 0.8332 target I had held a while ago and just below. GBPUSD has rallied more than expected. Meanwhile U.S. equities have begun to display a rather persistent downside bias that breaks with the recent correlation between the Dollar & indices. It does rather set the cat amongst the pigeons…

So just how deep can the Dollar dip? Good question…

There are pretty firm Dollar 4-hour bullish divergences in EURUSD & USDCHF, and potentially in USDJPY. GBPUSD has mixed momentum. Of course divergences can break and at the moment the Dollar is seeing lower lows and lower highs so until these break we do have an effective trend in place.

Of course, for me there also has to be a structure and that’s the bit I have problems with. What occurs in EURUSD seems quite critical as there is potential for a corrective structure to be in process from the 1.3968 low. It does appear to need one more push higher after this one at least and from this move we may be able to determine whether this is a trending wave or corrective. Very clearly, if this proves to be corrective then it will imply a new low below 1.3968 at some point…

However, looking at weekly momentum I find the prospect of a strong Dollar difficult. Therefore I have to accept that something slightly different to what I thought is happening and until I get a better idea of where the wave relationships lie I feel we should be watching the shorter term and until a clear structure is identified it will be prudent to take some care. Final word though, in the weekly & daily charts the trend is definitely Dollar bearish and that’s something that shouldn’t be fought if it attempts to extend losses…

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

Have a profitable week
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Friday, June 3, 2011

Today looks as if it could be an unremarkable day…

Actually, for the most part, yesterday was an unremarkable day… The most interesting part was the apparent disassociation across the 4 majors and of course the anticipated rally in EURUSD right up into its target range. I don’t see the Euro getting that much higher and with hourly & 4-hour bearish divergences this too should see the Dollar beginning to make gains. Probably today Dollar gains will be the main theme. I don’t see it being a particularly rabid, gut wrenching rally but probably fairly consistent once it has begun.

GBPUSD and USDCHF probably have a little more work to do in their respective consolidations but we should see the Dollar making gains here by the second half of the day. I’m still viewing these as corrective and unless some unexpected event occurs the next few days should be broadly Dollar positive.

The only one of the 4 majors that is beginning to bug me is USDJPY. I’ve been favoring losses but the constant deep pullbacks are beginning to wear down my patience. I’ve also noticed a potentially bullish structure in EURJPY. I don’t want to anticipate too much in the cross since it’s capable of some horrendous, complex and mind-blowing corrective patterns. The fact that I’ll be looking for losses in EURUSD doesn’t really support a strong cross. However, if we see any further recoveries in USDJPY we could suddenly see a sharp move higher. Apart from what I see as a “safer” call in EURUSD any move higher in USDJPY could be quite sharp…

The Aussie is balancing precariously on a tight rope and we’ll have to see which side it falls… The break levels appear clear. USDCAD should see follow-through higher today before correcting lower…

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

Have a great weekend
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Thursday, June 2, 2011

Dollar losses all but done… but probably one more high in EURUSD…

Yesterday saw pretty mixed results, some good, some not so good. Overall this contributes to the growing risk of the Dollar beginning to stand up for itself and attempting to re-assert its strength. Indeed, in GBPUSD, AUDUSD and USDCAD it did a pretty good job of it and this even brushed off in EURUSD by the end of the day. Against this, USDJPY and USDCHF resumed their losses.

So what for today? Well, I’ll cautiously go for further Dollar losses in USDJPY and EURUSD while GBPUSD appears due for a correction. I’ll even suggest that EURUSD should have just enough energy left in it for a new high but from this point on there is a growing risk of a deeper correction lower now. USDJPY is probably the one to watch as I feel this could still see quite sustained losses.

However, on the other hand USDCHF does seem due a pullback after its Kamikaze drop. I’m just a bit concerned about this one as while it has been declining pretty close to expectations the implications remain exceptionally bearish and almost too bearish to be believable… There is a rather juicy 4-hour bullish divergence so caution is warranted but it’s quite possible that the correction high I expect could rebalance that severely oversold situation.

A word on EURJPY… no new high and a sharp drop into range. This does have a complicated structure and I’m going to remain cautious. This pair has a handy knack of confounding with mega-ultra complicated range trading and I am rather suspicious that this may be one of those.

It’s another day to be aware of all manner of possibilities.

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

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE

Wednesday, June 1, 2011

I still think there is room for Dollar losses but more care is now required

Losses weren’t as robust as I had expected and in USDCHF and GBPUSD we actually saw a deeper pullback. I’m quite comfortable with USDCHF as it remains within the retracement limits set yesterday and unless this breaks the outlook remains bearish. GBPUSD… well that could be a different story… I can see a reason for this to have found its high and one piece of evidence is the bearish key day reversal.

Overall, even with GBPUSD I see the Dollar losing out today, the difference being that new extremes should be found in EURUSD and USDCHF but I’m more cautious about GBPUSD which could just see a pullback only. That one is more one to watch and react to developments now. Overall the Dollar lows in the other two should spurn deeper corrections at the very least…

USDJPY went and spoiled the party by whizzing higher early in the day. The depth of the rally is a slight concern and will need watching. However, at this point I feel it fits into one of those “deeper than normal” corrections and as long as it makes the right moves early on I would not be surprised to see new lows. If this develops then it, too, should imply a correction once the low is in place – but only a correction before losses.

Of course this led EURJPY higher and complicates the structure there. I’d still prefer to take a more passive stance here as it appears to be at risk of going on one of its meandering walkabouts, backtracking and reversing almost at whim in a complicated corrective pattern. I can only see it making significant gains if USDJPY decides to up stakes and make another stronger rally. I’m not prepared to go that route unless it proves itself…

There does seem to still be upside potential in AUDUSD and downside in USDCAD…

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

Good luck
Ian Copsey

UPCOMING HARMONIC ELLIOTT WAVE WORKSHOPS IN HONG KONG AND SINGAPORE