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HARMONIC ELLIOTT WAVE

Tuesday, July 19, 2011

The Dollar looks like turning lower today…

I’m not sure if yesterday was successful or not as I was pretty mixed. Directionally most went as expected but having done the analysis this morning I’m beginning to sense that the Euro has failed to develop a constructive decline and thus being corrective tends to point to a resumption of gains…

I have to say that this view tends to correlate with USDCHF, potentially with USDJPY (although it can hardly be described as directional after two days of practicing drawing a horizontal line.) Now GBPUSD may just reverse higher directly but it’s in one of those positions where it could also make a minor new corrective low first. However, the base direction remains higher so even if it does edge a little lower it’ll soon recover back above the 1.6193 high…

AUDUSD is in the same position as GBPUSD although I feel a dip to 1.0525 (and possibly a touch more) is probably the neater scenario. USDCAD should also extend losses though it is rather on a tight rope between extending losses directly and recycling to the 0.9778 high.

Finally USDJPY… Well, there’s not a lot that can be said except I still favor a decline… and one that should come close to the 76.31 low. A market may well come from EURJPY which itself had a rather lackluster day but in a general downward direction. I’d still prefer this to extend losses so it’ll mean that USDJPY must break lower soon and before EURUSD picks up strength… This could provide an interesting balance of play…

Good luck
Ian Copsey

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