Tuesday, April 28, 2015

Back into the range

I’m not too surprised with the way things developed – not that I had firm targets but did expect marginal Dollar lows before a reversal back into range. This has provided some constructive information - although not uniform across the currency pairs. There remains a certain ambiguity about the market, a sense that not all currency pairs will follow a correlated course. As such it does warn of some complicated development to come. However, for the main part it does seem as if we should see further Dollar gains after yesterday’s reversal.

EURUSD and GBPUSD appear pretty set, even if I had to adjust the count in GBPUSD which actually unravelled nicely as I looked at the broader daily development. These two should move hand in hand. However, I’m not quite so convinced that USDCHF is going to play ball and it’ll be prudent to watch key support/resistance areas that will tell us more about the next move.

AUDUSD, as discussed in the video outlook, had two options and took the alternative of a new high. This development raises the alternative – that we’ll not see consolidation. Thus, watch that carefully for signs of a more directional move.

While EURJPY sorted itself out, USDJPY continues to underwhelm. Its structure over the past month has been horrendously strange and really doesn’t generate much confidence. I’d suggest concentrating on EURJPY and EURUSD to get an idea where USDJPY will go. Basically I think EURUSD will drive the cross and we’ll have to work with breaks in USDJPY…

I can’t see easy moves today – and probably through the week – and therefor focus on short term trades.

Good trading
Ian Copsey  


Monday, April 27, 2015

Psychotic markets to prevail

Over the past month the market has remained in a range. Any attempt to extend the range has been quashed by a claustrophobic market fearful of what terror may lay beyond the boundaries they have set. Any fledgling impulsive development, in either direction, has had its wings cut as it approaches the vast unknown (but charted…) lands beyond the apparent barbed wire fences that have been set to contain the market within its confines. This appears to cover all the currency pairs I cover, U.S. Indices and even precious metals.

As we begin this week the pale, ashen faces of traders are looking out through the barbed wire fences of the Dollar downside. Is there enough collective will to force a breakout? Looking at momentum there are signs of a reversal. It’ll require some confirmation and with the 4-hour Price Equilibrium Clouds heavy and grey, there is a chance – but equally, as we have seen before, the market loses its confidence by remaining steady as it looks out upon the barren lands beyond.

From a structural point of view, the wave structure is as complicated as I have seen for several years. One month of consolidation and complex development doesn’t raise my hopes that a trend will suddenly send a shining light of hope for the dull grey listless eyes. Certainly, this morning’s open has generated an enthusiastic reaction that can only be likened to the promises given to electorate in a general election.

If anything, the market should see the Dollar take a look at a bearish breakout but only for a reversal back into range…

Have a profitable week
Ian Copsey  


Friday, April 24, 2015

DAILY FORECAST FOR EURUSD

INTRADAY CHART
BIAS: Cautiously I feel this could eventually reach 1.0940-71

Resistance: 1.0850-60 1.0887 1.0910-15 1.0945-50
Support: 1.0800-05 1.0780 1.0750-55 1.0730-35

MAIN ANALYSIS: Once again the downside failed. It tends to point to a large triangle but be aware that, as we have seen recently, these can produce the most excruciating complexities. While 1.0800-05 supports there's risk of follow-through to around 1.0850-60. From there we should see a correction - holding between 1.0780-00 - for gains to the 1.0939 area - maybe a bit above - for a correction. Take care, this could be as much as 100 points. Once this correction has been seen the next upside target could be 1.0910-15 minimum but I suspect the 1.0960-70 area.

COUNTER ANALYSIS: A break below 1.0740-55 would see losses extend and to 1.0700-20 at least. Take care there. Below note the 1.0665 low.

MEDIUM TERM ANALYSIS:
24th April:   While I'd like to see further development, there is a stronger suggestion that we are going to see a sideways consolidation and because of the upside we have seen, I suspect a triangle that would suggest a high around 1.0910-70. Before providing any further information I'd like to see this first move higher develop to confirm my suspicions. Overall, this should imply a rather messy and difficult development. 

Good trading
Ian Copsey

This market is going to remain unstable

For some while now, whenever there is a sliver of a potential to see a more impulsive move develop, the market backs off. Once again yesterday, just as it looked like we would finally see Dollar strength develop, the move fell through. This is beginning to suggest a much larger daily consolidation and one that looks like it will stretch into May.

From this perspective the approach towards trading must be to execute short-term grab and snatch raids. This is not just down to the consolidation but the sheer noise in the market that is causing difficulty in identifying key waves. This process should imply USDCHF continues to edge lower. In GBPUSD I’m a little more cautious because, assuming we see a minor new high, it will complete a long-term consolidation. With the U.K. general election around the corner it seems most likely that the Pound will likely lose out as the poll date nears.

Even AUDUSD appears to be being pulled into the sideways consolidation – and therefore do take care…

Even USDJPY has become stuck in a strange place. I’m not quite sure what to make of yesterday’s high. However, if it does make a bolt for the recent lows, I’d suggest following it. The risk is, of course, that it could also be holding in a range. That EURJPY rallied – and still has positive momentum – suggests USDJPY would have to be pretty weak to drag the cross down with it. I’d tend to suggest leaving these two alone for today and look how the outcome fits into the larger picture.

Don’t expect much today and you probably won’t be disappointed…

Have a great weekend
Ian Copsey  


Thursday, April 23, 2015

Obsessive compulsive complications

Ugh… what a market it has been for some weeks now. Somehow the development never seems to go smoothly, tending more to push corrections to extremes and make heavy work of what should be a simple outcome. That occurred again across all three Europeans yesterday – EURUSD forging an even deeper retracement, also USDCHF (although within limits) and GBPUSD decided to go solo in rallying when I had expected a narrowing consolidation.

So as we begin a new day, I’m basically back to what I had thought would have occurred yesterday, although perhaps slightly adjusted in GBPUSD. There is no change in the expectation of Dollar gains but today should bow to the weight of argument in favour of the Dollar. That would not rule out a potentially new corrective high in GBPUSD. Equally, we had a deeper than expected correction in AUDUSD… and guess what? I can repeat the comments I made just above concerning the expected Dollar move.

My preference is that, once this has got going, the Dollar should demonstrate more consistency in its development. However, given the recent history of complex corrections - and deeper than expected – it will be worth taking care.

USDJPY has made some consistent gains again although it has not yet really made a clear case for direct follow-through. With this strength and the additional blip higher in EURUSD, the upside finally break above the 128.77 high in EURJPY. I’m still quite cautious here with the expectation that the follow-through in EURUSD will likely be stronger than any possible strength in USDJPY. Overall, it could still lead to erratic behaviour in the cross.

EURUSD and AUDUSD look like the better vehicles today.

Good trading
Ian Copsey  


Wednesday, April 22, 2015

Ragged but directional

While the basic direction has been as expected, the manner in which price is developing is still really quite haphazard. Currently I’m seeing normal projection ratios off by a few points, corrections being exceptionally complicated and even momentum signals rather vague and weak. I have been told in the past of a particular cycle method that, for a period of one or two months, we tend to have higher than normal … err… abnormality. It certainly feels like we are in that period. I would recommend exercising extreme care and deploying practical stop losses – and more important, take profits.

The Europeans have seen some modestly deep corrections following Dollar gains. While keeping in mind the potential for complex corrections and spider prints on the charts, the main direction should remain the same. I would also suggest that there is a quite a strong risk of a more directional move today. The same can be said of AUDUSD which actually performed very close to expectations yesterday. Ideally it should extend losses now.

USDJPY did marvellously well to reach my upside target… but then followed through. The entire development from the 118.32 low has been exceptionally complicated, having me consider lower daily retracements one day but then fail. There appears to be a lack of logic in the structure – which may well be an indication of a complex corrective pattern in development. With EURJPY recovering and surpassing the most recent high by 1 point, this also causes some complications – particular with EURUSD expected to continue the basic move lower. So now that USDJPY has been more “perky” than expected it feels like we’re wavering between bullish and bearish. I have found this so illogical and complicated it’s difficult to actually be able to be 100% certain of the outcome. Treat the JPY pairs with a solid dollop of care.

Good trading
Ian Copsey