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HARMONIC ELLIOTT WAVE

Thursday, February 23, 2012

There are a few strange developments…



I found the analyses a puzzling mix today. What happened in the Euro and Swissie did not surprise but was actually the most complex of alternatives I had envisioned. It hasn’t ended yet and may well produce a sting in the tail although if the Dollar downtrend remains intact the sting needs to develop in the form of minor new lows and a recycling. That part was quite a simple deduction but some of the other pairs did raise my eyebrows and my concern.

Just focusing on the other European – the Pound… At first I was quite content with the losses seen and looked to be right on forecast. However, the greasy slip down towards the 1.5644 low was just a bit too much for comfort. This is now stretching my imagination if I am to remain bullish here. There’s a bit of wriggle room and I’ll detail the limits in the individual analysis today, but suffice it to say that if this pair doesn’t recover swiftly and break resistances there is a hint of very strong losses. Given I don’t feel the same way about the Euro and Swissie I’d rather wait for confirmation to be seen in the Pound but it is a risk that should be noted.

USDJPY extended its rally, dragging the cross with it. However, I can’t see either as having the legs for much more topside. Although the area we are approaching has been a target for me, what has bugged me is the lack of a decent intermediate pullback in the approach. Nevertheless, momentum in both has slowed – in hourly and 4-hourly – so I do feel it’s time for a deeper pullback for them both. However, I do see it as a correction at this point.

So today I feel should be a more interesting and important one, in particular within the Europeans. The balance that needs to be observed is between how the Euro and Swissie develop versus the Pound and whether one begins to exert influence over the other. I still find it hard to get bullish Dollars at this point but with this conflict it’s worth noting what breaks what…

Good trading
Ian Copsey

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