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HARMONIC ELLIOTT WAVE

Friday, July 15, 2011

Has the Pied Piper come wandering into the market?

Why? I thought I smelled a rat…

I was going over some charts in the afternoon explaining to a contact that since the 1.6036 high EURUSD has been moving in 3-wave structures. Ok, I use 3-wave structures for impulsive trending waves too as they generate excellent projections. However, if you look at the weekly chart there’s no way you can argue there has been a clear trending structure from the top to 1.1789… It’s a classic corrective structure, or perhaps part of it is…

Take that down to recent price action if it’s going to go down, it must now… otherwise it’ll continue to develop in a corrective manner. Sniff... sniff… The Pied Piper seems to be around… The correction over the past couple of days, while it was expected has extended much higher than I had anticipated. There is always a nasty complication of a deep retracement in a position which you wish it wouldn’t, but there’s also another possibility – one of a total recycling back to the 1.4696 high…

Nasty idea? Well, that’s what corrective structures are all about and why they exist…

Dare I say that if EURUSD gets much higher it could actually fall back into correlation with the other currencies in the general distaste for the Dollar… and that could see EURJPY slow to a virtual halt, a little trait that it has perfected and like to put into practice on a semi-regular basis.

So today is one to be aware of this potential so as not to be too surprised…

Have a great weekend
Ian Copsey

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