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HARMONIC ELLIOTT WAVE

Friday, July 29, 2011

Still not quite what was expected but still broadly in line with the larger picture

I had been looking for a quicker resumption of Dollar losses… but fell asleep waiting for them… The reasons I had thought we would see a quick correction was actually GBPUSD. Here I couldn’t see much downside at all – support at 1.6297… It was interesting to note that this support broke by only 3 points while it took the Euro the best part of the day to correct very close to the full extent of the retracement support area I indicated. Now both those levels hold the implication remains higher for both of them…

That left USDCHF treading water for the rest of the day but remaining below my 0.8046 resistance, a nice flat correction while USDJPY continued to perform in its own drugged state, staggering this way and that but without any conviction either. I do feel that once the Dollar continues its losses these two pairs will extend losses also.

Once EURUSD, GBPUSD and USDJPY hit their Dollar lows we should then see a stronger reaction. I suspect USDCHF will also but in all but the Euro I see the Dollar strength being temporary. However, that needs to be addressed at the time and there’s still a day or two to go before we even reach the Dollar lows.

That leaves AUDUSD. I had wanted resumption of gains but instead it chose a deeper correction. It’s still above critical support so I’ll remain bullish here too. USDCAD was move volatile than expected there's reason to be more cautious here as the structures have become rather ambiguous...

Have a great weekend
Ian Copsey

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