Friday, October 24, 2014

Tangled

All looked to be developing well… but then stopped. The bigger picture still looks intact but the lower degree development clearly defeated me yesterday. There are some clues, some enigmas and the rather curious case of the lost USDJPY.

I’ll begin with the Europeans as usual but will have to split them between the Continentals and Her Majesty’s sovereign (but wayward) currency. EURUSD and USDCHF seem to be a relatively simple case of an alternate development which triggered a deeper than expected correction. The only complicated part is the very short term that seems to suggest some initial push me pull you to correct a bad posture before the Dollar upside can continue. This seems to be a need for a limited swings on both sides of the market to allow a correct structure to develop. GBPUSD seems to suggest the same but with what looks to be a minor new corrective low and recycling higher before that can extend losses. This is the one that concerns as the amplitude of the swings appears wider than the Continentals. This could be a source of conflict so do take care in the first half of the day.

The Aussie… Still on a walkabout…

What really did kill me yesterday was USDJPY. I spent a long time trying to work this out, testing both bearish and bullish scenarios but really failing in terms of identifying an impulsive structure. The clue that should provide the solution is likely to be in EURJPY. I had thought that it was already on its way lower so yesterday’s reversals in both JPY pairs was like getting slapped round the face with a piece of rotten sashimi. My primary approach is to test out levels in the cross, knowing where the limits lie, and it should be this that spots the outcome. The secondary approach is an alternate count I feel is possible in USDJPY. This will require attention to whether the expected top in EURJPY and the emergence of bearish divergences in both to suggest a resumption of losses. The alternative appears quite bullish…

It looks like a challenging day. Take care.

Have a great weekend
Ian Copsey  



Thursday, October 23, 2014

DAILY FORECAST FOR EURUSD

INTRADAY CHART
BIAS: Losses should continue today

Resistance: 1.2651 1.2680 1.2706 1.2725
Support: 1.2636 1.2600-08 1.2575-82 1.2540-50

MAIN ANALYSIS: Yesterday's early correction failed to even reach the 1.2757-84 resistance and stalled at 1.2739...  I feel today could see the same pattern - a limited recovery to around 1.2651 - before losses resume below 1.2706. Still take care at the 1.2624 and 1.2605 lows but overall the decline needs to reach the 1.2575-82 area for a correction back to 1.2585-00 before extending the downside to 1.2520. This would then require a correction of around 50-75 points before lower. I expect the final low to come a bit later at 1.2415.

COUNTER ANALYSIS: Only a direct break back above 1.2670-80 would surprise. I'd still be a bit reluctant to follow it higher but note the 1.2706 high and the 1.2725-45 resistance. Further resistance is around 1.2764-84.

MEDIUM TERM ANALYSIS:
23rd October: 
Still, as far as I can see, we are actually towards the final stages of a 5-wave decline from 1.3993 - currently en route the 1.2415 level that should provide a pretty deep correction.

Only directly back above 1.2739 and 1.2900 would require another review - but probably see gains to 1.2930 at least - possibly even 1.2996...

Good trading
Ian Copsey

Follow-through

At long last we have broken out of the consolidation and confirmed the Dollar gains for which I had been (im)patiently waiting… These should be relatively direct although a later correction will be somewhat deeper. This seems to be working through the three Europeans in general. I am particularly comfortable with EURUSD, relatively comfortable with GBPUSD because there are two potential targets and basically satisfied with USDCHF – in this rally. Where I do have a problem is matching the structures because USDCHF seems to have an alternative structure – perhaps one more leg than the other two. That I shall solve following the Dollar rally we are seeing now.

The Aussie … it seems to have quaffed too much Fosters lager… The trail it has left over the past few days is more like a walkabout in the Outback. I had thought I’d solved the impasse between bullish & bearish but the early correction lower I suggested didn’t reach target but extended gains once more, but still taking an inebriated path. Therefore, it’s back to bunkering down until the situation becomes clearer.

The JPY pairs also developed well. The gains in USDJPY worked almost perfectly, but still in the right structure without dragging EURJPY higher (by very much.) This was the perfect outcome but I feel the downside in the cross will, before too long, accelerate. The implication for USDJPY is also implied from that conclusion…

It looks like today will be mostly similar to yesterday but with the exception of USDJPY…

Good trading
Ian Copsey  


Wednesday, October 22, 2014

Market procrastination

That was another strange day… Very clearly the market is not convinced about either direction and certainly not committed to any direction as yet. It was good that USDCHF managed to make a minor new corrective low but the fact that EURUSD could only muster a feeble retest of 1.2839 (precisely) is really quite puzzling. At the same time GBPUSD failed to establish an impulsive target which, in its current position, is a humdinger of a dastardly, devilish conundrum.

If I take the Continental Europeans as a pair they appear to be touching a (Dollar) projection high which will basically mean they have not really broken range. Thus, the reactions from there are going to be critical – shallow or deep is the question. If shallow then the risk remains for a higher Dollar else the chances will favour a recycling back to yesterday’s (Dollar) lows. So watch those areas carefully. However, this doesn’t provide an explanation for GBPUSD and it’s this which puzzles. Best take a neutral stance until the direction is clearer…

AUDUSD continued higher but in a rather slap-dash, untidy and crumpled manner. It tends to suggest a recycling also. However, this development does raise the possibility of a more bullish outcome but we need to see breaks to confirm either direction. Thus, once again note the levels on both sides of the market that will trigger follow-through.

USDJPY slipped, and slipped again to threaten a resumption of losses. However, quite normally, it stalled just above critical support and looks to be pushing back higher. This should take it to new highs and with EURUSD expected to be firm, the risk is for EURJPY to be dragged higher too. In terms of the JPY pairs there is a terminal number of times it can push higher and these will be the last.

Overall, I think we’re much, much closer to a more directional break. However, take care until that break is confirmed…

Good trading
Ian Copsey  



Tuesday, October 21, 2014

WEEKLY OUTLOOK FOR SILVER

INTRADAY CHART
21st October:


The Wave x was more complicated that I has anticipated and looks like an expanded flat. This should now continue to see some choppy gains that should reach the 41.4% retracement at 18.38 minimum and could (and more likely to?) the 50% retracement at 18.73. This should complete the Wave -iv- from where we should see Wave -v- reach the daily (cyan) Wave iii.

Good trading
Ian Copsey

It ain’t over until it’s over…

Well, blimey crikey mate… the market didn’t ‘alf make a pig’s ear of trying to reverse… The day began well and I was thinking, “yep, that looks ok…” and was followed by “ok, I can take a recycling” and in the end it was “now that just isn’t working…” Certainly, it was very introverted trading and that clearly suggests the market isn’t quite ready to make a firmer stance or agree on a direction. Therefore, what this does now mean is that yesterday either saw a deep, deep correction in the lower degree or more likely we could be seeing a slightly deeper correction in the higher degree. Clue 1 for today is that Asia will almost certainly not rock the boat. That probably puts the odds in favour of marginal deeper Dollar losses.

To be honest, there’s a not a lot more I can add to the above except to say I still think last Wednesday’s Dollar lows in should still remain intact in the Continental Europeans (or perhaps suffer a minor breach) and that possibly USDJPY could make a new corrective high – probably EURJPY also.

This turn-around in the short-term fortunes has allowed GBPUSD to extend gains more directly than I had anticipated although the structure does suggest a slow development with a couple of modest corrections en route. Perhaps the anticipated high there could provide a signal for the rest. (Maybe it’s a case of Rule Britannia! Britannia rules the Harmonic Elliott Waves…)

As for the Aussie … it has moved slower than expected also and while I had hoped for losses to develop, nothing has gone wrong to suggest the downside is failing. Obviously, with the rest of the market exercising a high degree of uncertainty there are still some risks in the Antipodean but the downside still has the edge for now I think…

Another cagey day today by the look of things and if there is to be a firmer directional move it would appear to be later in the day rather than sooner…

Good trading
Ian Copsey  


Monday, October 20, 2014

Make or break

Clearly the market had little or no desire to end the week with a bang. However, there’s a growing chance that this week will provide a “pop” and potentially a “bang” although I see a broader tight range within which a lot of development needs to be seen. This tends to suggest deeper than normal corrections, possible even some complex. So it looks as if it could be difficult week. In particular, I still see a development mismatch between EURUSD and USDCHF that appears to require such choppy movement for both to maintain their independent structures without conflict.

I have noted that while EURUSD and USDCHF had a particularly range bound day on Friday that they both developed constructively and are also now pushing the Dollar upside limits of the 4-hour Price Equilibrium Clouds. They both now need a nudge to break cleanly away. This happens just as GBPUSD reached the upside target I suggested on Friday and requires a brief period of weakness. Interestingly though, is that GBPUSD looks more like it’s in a bullish sequence right now (although requiring a correction) so there appears to be a slight disconnect across the English Channel.

The Aussie also managed to poke a little higher and now it has to make a decision. It has been moving sideways and clinging lovingly to both the hourly and 4-hour Price Equilibrium Clouds. We now just need a decisive break to confirm the next direction.

The JPY pairs also developed as expected, both edging higher. There still seems upside available to USDJPY having broken above the 4-hour Price Equilibrium Cloud but does face a declining daily Cloud not too much higher. I would expect the daily Cloud, once approached, to be the more dominant force. This suggests a gradual upside process developing so the downside acceleration – or lack of – in EURUSD will have a determining impact on EURJPY. It does still have some upside available but is (not so) fast approaching resistance.

I suspect the Europeans and possibly the Aussie to be the better movers today but don’t bet on anything aggressive.

Have a profitable week
Ian Copsey