Wednesday, July 29, 2015

DAILY FORECAST FOR USDCHF

INTRADAY CHART
BIAS: We should see a move down to the 0.9546 - 76 area before the rally resumes

Resistance: 0.9635 0.9673 0.9708 0.9740-45
Support: 0.9602-13 0.9570-75 0.9546 0.9524-29

MAIN ANALYSIS: The rally was seen to 0.9665 - and actually 0.9673. This produced an hourly bearish divergence and could - potentially - develop a head & shoulders. I'm not too happy with the additional 8 points but I've noted some mildly wayward ratios. What's more, it does tend to match with the outlook in EURUSD. Thus, we should see losses down to the 0.9570-75 area minimum. Allow for 0.9540-46. This pullback should support for gains to resume and back above 0.9673 and to between 0.9708-45 - max 0.9766.

COUNTER ANALYSIS: A break below 0.9524-40 would suggest losses to around 0.9505 and potentially lower.

MEDIUM TERM ANALYSIS:
29th July:  Upward progress is being made and while 0.9550-75 supports we should see gains break above yesterday's 0.9673 high and up to 0.9708 minimum but with a wide target range between 0.9708-66.

Below 0.9524-40 would break the bullish sequence and risk losses below 0.9505 and potentially lower.

Good trading
Ian Copsey

Deadly dull Dollar

I found yesterday a strange day. There were no two halves, but a steady singular directional move in most of the currency pairs. That we didn’t see a minor new high in EURUSD was a real disappointment although the 1.1129 was smack in the middle of the expected target area. Thus, it spent the day drifting lower along with USDCHF edging higher and GBPUSD doing it’s own thing, confirming its strength. From what I can see, we should see the opposite today - in the Continentals at least – and see GBPUSD correlate with EURUSD – but only for a while.

The Aussie also declined the opportunity to extend its losses. There’s risk of consolidation now – potentially short term and perhaps even longer. Much will depend on the structure of this initial recovery. However, it’s pretty obvious that compared to the free flowing losses of the past year, it does seem to have run out of steam to a certain extent. This is down to major targets being met from 3 years ago and is demanding a slower development and the likelihood of more corrective behaviour that needs to develop. Right now we do need a minor lift before there can be any further losses.

In the JPY pairs we have seen upward progress in USDJPY. It’s in a position, at this point in time, where it can move either way. However, the upside has less room for manoeuvre while the downside has a bit more spaciousness. Key to this pair, is understanding where it breaks lower – or decides to extend yesterday’s gains. One clue is in EURJPY that does need to move to a new high that could be driven by either EURUSD or USDJPY. Finding the balance here is crucial.

No home runs today. Keep things tight and steady. The rest of the week should provide a more directional move.

Good trading
Ian Copsey  


Tuesday, July 28, 2015

WEEKLY OUTLOOK FOR AUDUSD

INTRADAY CHART
28th July:


The triangle was a tricky one and appears to have ended at 0.7417. We are now close to the Wave (a) which should stall around the 0.7245 area. I suspect a correction higher in Wave (b) of around 66.7%-76.4% between which would suggest an approximate 0.7360-76 area. Basically watch for bearish reversal indications for losses to the minimum 50% projection at 0.7218 but could get as low as the 0.7183 area. Equally, as this decline develops watch for bullis reversal indications noting a daily bullish divergence currently developing and match this with the 4-hour & hourly charts.

Good trading
Ian Copsey

A day of two halves?

It wasn’t a day for swingers after all, although the way price developed did produce rather strange excesses from time to time. Indeed, I feel this process is going to continue for the first half of today and considering that we’re going into the Asian session, there’s every reason to consider the idea of consolidation. However, once this current process is complete we should find a stronger directional move should be the result. Even then, from the balance between USDCHF and EURUSD there is a hint of a period of almost sideways trading – that is to say that there should be some minor breaches and reversals over the early period.

GBPUSD made some steady gains. I still haven’t made up my mind whether it’s going to rally directly or following a deeper correction again. It has both choices so it’ll be important to recognise the levels that would point it in a particular direction. Best remain a little cautious until this is clarified.

The Aussie also did relatively well, retracing higher as expected. However, the main risk does remain lower and at some point we should see new lows. I am undecided over the larger structure but currently I am watching the bearish development and will look for this to develop first…

As mentioned in the weekly video outlook, USDJPY broke free from the consolidation quite early in the day and has seen losses to the next price target. This should see a period of corrective behaviour. However, note that EURJPY is getting stretched on the upside. Therefore watch the relative balance between EURUSD and USDJPY and see what the implications of breaks in the individual pairs.

In summary, the first half of the day looks a bit whippy but I suspect some movement towards the end of the day.

Good trading
Ian Copsey  


Monday, July 27, 2015

Summer has come early

August has traditionally been the month where the market seems to die a death with traders mumbling about the Summer Doldrums. It almost seems as if the market has been that way for 3 months already… and it seems like the market has succumbed to seeing this extend even further. Personally I don’t think it’s going to be the same this year, but right now there’s a good chance that we could still remain in that range for now.

That said the current losses in the Dollar were basically expected although I haven’t caught the levels too well. There is still more to go and I suspect from the balance of required developments across all currency pairs that we’ve still got a way to go to complete this segment of the larger structure. There does seem to be a modestly clear picture within both EURUSD and USDCHF of continued swings over the coming days.

GBPUSD has been complicated and defeated me over the past week or so – but I think I’ve resolved this. It needs confirmation and with the market we are seeing, it may take a day or two more but should resolve the current consolidation. On the other side of the world, AUDUSD has made its break and this should continue overall but only in steps rather than the leaps that it took over the past year. Today is likely to be a slow day I think.

Over in the humid and sweaty JPY lands, USDJPY seems a bit reluctant to extend losses. It’s a little touch and go, but I feel it could move sideways today. This is down to EURJPY that appears to want to make further gains but probably more driven by EURUSD and therefore the suggestion is for further consolidation in USDJPY - best watch the range carefully and adjust if there is any sign of a break of range…

Have a profitable week
Ian Copsey  


Friday, July 24, 2015

Wild West Rodeo

That was a very, very disappointing day. Actually, it was also a very, very strange day. The underlying outlook in EURUSD was always higher but I hadn’t expected it to develop yesterday. I took that view based on both USDCHF and GBPUSD and their reactions were equally against what I thought was logic. So I have to find a new logic but I’m not sure of its certainty. The decline in GBPUSD I can “sort of” take if only that the 1.5490-00 area was always the extreme support area. However, in USDCHF, yesterday’s decline has reached support levels of what should have been the next higher degree – but the prior lower degree development doesn’t appear to have been valid…

So, it’s a bit of a puzzle. Ideally it should imply that both GBPUSD and USDCHF recover the ground they lost. But what of EURUSD? Well, I have a structure but not one of which I have great confidence… What I seems to have found is the potential for a Wild West Rodeo that would see a significant degree of Bucking Bronco ups and downs.

That AUDUSD remains in a strange consolidation that needs to be allowed to develop to fruition to be certain of the next move does tend to back up the need for care.

What should be the clearer picture is USDJPY. I hope. It capped in my resistance area – having taken most of the day to make up its mind – and does seem to be following on from Wednesday’s analysis. This seems to work with EURJPY also. While the higher retracement was the alternative, it was one that I knew could occur on break of resistance but I’m not sure it has completed its move. Overall, that tends to suggest that we shall go into the weekend following some unsteady and potentially erratic development…

I think the above basically suggests that it doesn’t look like a particularly safe market. Don’t take risks.

Good trading
Ian Copsey  


Thursday, July 23, 2015

Repeat

That was a mostly decent day. The Europeans developed well, the Dollar on the ascendant in the Continentals while GBPUSD finally managed to shake off the impact of the others to push back higher. By the end of the day the market decided that enough was enough and sought a correction. I sense that yesterday’s template may well be repeated today with particular reference to USDCHF that has a slightly alternative structure to EURUSD. Continue to keep that in mind because they should work well in tandem. This should see GBPUSD manage to hitch another ride to the upside.

AUDUSD… is still not safe. Its recent structure from the 0.7371 low kinda reminds me of the development in EURUSD from the 1.0462 low. Sure, it has a different structure in terms of expansions and consolidation, but the complexity is extremely high. I’d much prefer to see this make a move to the target I mentioned yesterday or a direct break below the 0.7327 low. Until then there remains risk of complications that, within a complex irregular correction, can whip you out with a “whoopididoo.”

The most disappointing currency pair was USDJPY. I called the low a little too early and therefore has seen a deeper correction. In that case, follow yesterday’s analysis basically. In particular, EURJPY is stretching the limits of the upside and it’ll be well to keep an eye on that. I’d much prefer the cross to decline now but there’s hardly any room for manoeuvre.

Basically the Europeans and USDJPY – probably EURJPY – should have straightforward days. Of all, it’s probably EURJPY that could potentially have the best day.

Good trading
Ian Copsey