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HARMONIC ELLIOTT WAVE

Wednesday, October 26, 2011

Momentum slowing and risks a pullback from a new low…


It was a bit of a weird day yesterday. The market seemed totally freaked out, not knowing what to do. So they bought and sold – not necessarily in that order – and probably hit the wrong ends of the range. Perhaps the more accurate forecasts came in AUDUSD and EURJPY which are not really known for obeying my subliminal influence. (Editor: takes tongue out of cheek.) However, both now seemed destined to rally although I can’t see these moving too far. AUDUSD should move to new highs in this move but EURJPY seems set to fall short.

Indeed, this general slowing in the Dollar’s decline does seem to indicate a modestly pullback after this next decline so I feel it’s a day to look for buying levels to take advantage of the pullback. USDJPY may already be in this mode having failed to extend losses by very much and actually looks like recycling higher. Overall, though, I still remain bearish on this one for the next intermediate targets below 75.00…

GBPUSD and EURUSD seem to be suffering from tripping over their own feet with limited follow-through and messy pullbacks. I still fancy these two to extend higher later today but we’ll have to see how robust that is – and for that keep watching momentum. It’s still Dollar negative but not really displaying a keenness to accelerate lower.

So overall it’s probably a day to take care and I feel the stronger pictures are being shown in AUDUSD and EURJPY which should be the better bet…

Good luck
Ian Copsey

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