Friday, December 2, 2016

Squeaky bum time…

Well, yesterday was a long day. I’ve mentioned this before, several times, my form of Elliott Wave is far more rigorous in terms of structure and ratios – so I can’t go plopping letters or numbers on bars just willy-nilly. I resolved GBPUSD yesterday. Even when I woke up around 2am this morning I sat in front of my charts and stared at them – mostly at EURUSD – to work out how a structure that would be logical. Thankfully, I had a Eureka moment and it seems to be working. Clearly, following a pretty large restructuring there’s always a need to confirm the outcome. However, the developments in USDCHF and USDJPY, in particular, are also supporting my expected outcome overall. Therefore, I have some pretty focused targets and accompanied by limited stop losses…

Even AUDUSD suddenly dropped a large smelly one. These are the impulsive waves that have extra-large pullbacks in Wave b/iii. This one was even after a new low – so we have seen an expanded flat in the Wave b/iii. It’s rather like having Grandma’s knickers hanging up to dry in the front room… However, the outcome should still remain the same and the targets still valid.

EURJPY saw a new high and sporting a glorious hourly bearish divergence – and has (as I write) broken below a wedge support. The only concern I have is the firm 4-hour and daily momentum readings. For now it should slip lower but the wedge target is limited. Once that is seen it’ll be down to tonight’s proceedings…

Profit or stop loss tonight…

Have a great weekend
Ian Copsey  

Thursday, December 1, 2016

Approaching the NFP

We’ve seen some whippy trading over this week. While it’s not until tomorrow, it appears that the market is trying not to overextend its exposures ahead of tomorrow’s Non Farm Payroll release. From my point of view, of course, I don’t take the NFP into consideration in terms of direction. However, pre NFP does have a habit of collective caution pre-release and it certainly looks to be the case this month.

Overall, I have some pretty concrete expectations and in general the structures do appear to be developing in my favour – but there’s still work to be done to see my expected outcome brought to a conclusion. We have seen some new highs in the Dollar from last week – particularly in USDJPY and in USDCHF. However, the erstwhile EU pairs in GBPUSD and EURUSD have found headway rather more difficult to traverse. GBPUSD appears to be angling for further gains – but just below the 1.2531 high… That’s going to be an interesting contest…

That USDJPY has been particularly strong but there is a possible barrier at 114.86-94… What happens around this will be important. EURJPY has some lower degree divergences but weekly momentum still pointing higher… but I’m not so sure the upside can continue much further at this point… Thus, keep a track of these three as I feel this can be an interesting ménage à trois…

The Aussie, once having seen the double top, knew that we should see losses but what did surprise was the strength of the decline. I had expected a slower descent. However, from this point there could be more complicated development – but still lower.

I’m not looking for a lot today but what happens pre-NFP will provide some possible clues.

Good trading
Ian Copsey  

Wednesday, November 30, 2016


BIAS:     We should see losses to 110.75-00 for gains to then reach 121.00-20 (over a few days…)

Resistance:    119.82          119.97-15          120.51          120.65-75
Support:         119.35-45     118.95-00          118.75           118.54

MAIN ANALYSIS:    Hmmm… things have changed. Yesterday's strength was unexpected but now provides us with a stronger structure. The rally from 118.54 to reach 119.97 developed in 5-waves and this forms the penultimate high in this rally. It also implies a deep pullback in yesterday's rally. This should see the 118.75-00 area support. From here we should then see a move up to the 121.00-50 area approx. 

COUNTER ANALYSIS:   Only an earlier break below 118.54 would suggest I have been using an incorrect structure. It would likely see losses back to the 118.10-115 area and below there to 117.30-71…

Good trading
Ian Copsey

A clearly cautious market

My, my, this morning’s analysis was a tough one. Too many mini-minor ragged swings that made life difficult to catch the ratios. In these instances it is better to identify a valid 5-wave move and then work around these to see how the prior and latter development fits into the picture. On top of that, these lower degree waves need to work with the higher degree waves – and so many with difficult, noisy moves. I have a preference – but a cautious one – and needs some breaks to confirm one direction – or the opposite. Having said that, the Dollar downside appears limited – but that could have serious consequences. Thus, we are walking on a tightrope and it’s best to know where these breaks lie…

I’m also seeing the dying embers of the recovery in EURJPY. It does still have a way to go – not in terms of movement but more of the final two legs of the rally from 112.61. This tends to suggest that we’ll see two-way trading and broadly balanced between USDJPY and EURUSD – but of course allowing for the swings that need to complete the rally in the Cross. Initially, that doesn’t really give us much of a clue for the two intrinsic pairs expect that they seem to have a general correlation without excessive deviance levels.

Thus, we should generally see steady moves in all $-currency pairs... This also includes the Aussie that has seen its energy levels reduce dramatically over the past year but at some points we may well see some divergence between the Europeans and JPY versus the boomerang currency.

Today should start as normal – very quiet – that should set up the market for a stronger move. Well, perhaps that’s a bit too early because we’ll need some foundation waves to develop – and which may well end up seeing a generally quiet week as we move into the Non Farm Payrolls on Friday…

Basically, expect limited ranges for now and wait for the signs of a breakout…

Good trading
Ian Copsey  

Tuesday, November 29, 2016

What was that?

It seems I misread part of the structures in the Europeans. It does make any difference to the targets I have but yesterday’s deeper pullbacks – as advised in the update – provided the ballpark barriers. The reversal higher in the Dollar was pretty much as expected.

As today begins we have options on both sides of the market. Have we seen a completed correction or will we see a direct follow-through? These are always the more challenging moments when considering the depth of a pullback. Even the Price Equilibrium Clouds have a slight duality. In general price has reversed through the hourly Clouds but the 4-hour Clouds are still providing resistance in the Dollar. Having said that, in general the 4-hour Clouds are flat with current price smack dab inside the Clouds… However, this may well provide the clues to next move…

The Aussie is holding above the rising 4-hour Cloud while price is smack dab in the sideways moving hourly Cloud – but it’s also starting to see an hourly bearish divergence. The risks are there – but the 4-hour Cloud will likely support – so there’s still a little ambiguity. Take care with this one.

For the JPY pairs – well, EURJPY should still look for the target area I have been indicating over the past day or two. The pullback lower in USDJPY has been relatively shallow – so the balance between EURUSD and USDJPY is going to be a bit of a puzzle. Which individual pair will push the cross? At this point I am divided on this… Thus, take care…

Ideally, I’d like to see a solid move develop but the early stages in the day will be critical…

Good trading
Ian Copsey  

Monday, November 28, 2016

What a waste of energy…

I had expectations for a stronger directional move to develop on Friday but clearly that did not come to pass. Indeed, the move higher in EURUSD to 1.0627 was exactly the same type of move that we saw in the Trump Spike that saw price move to 1.1299. Neither of these two instances really required such a deep pullback. However, what it implies is a stronger trend in the Wave (c)… Annoying - but frankly no harm has been done to the structure.

So the longer-term outlook I have been following is still in place and – should this continue – we’re still pointing to the range of targets over several wave degrees. While it’s a bit early in the week to mention, Friday’s Non Farm Payrolls will likely provide a catalyst. I mention this in order to enable some clarity as we approach that release – what degree of noise will it make and how will it fit into the larger structure. These will be factors that can be mulled over during the next few days in the hope of being able to take advantage.

I still have some mixed feelings over USDJPY and tend to feel that we are in a terminal process in the current wave degree. I don’t think that it will impact that much on EURJPY. Instead it’s more likely going to be driven by EURUSD. So there is some balance between the three pairs.

The Aussie has been making gains, a little messy but steady. It is currently in a position where it can correct see some losses – or even make some gains. This provides a rather difficult outlook for now and it’ll be better to wait for breaks that will confirm one of two outcomes with the bullish side being the easier to identify the next wave. The only trouble is that it could still dip first. Thus, with an unstable structure I’d suggest leaving well alone until one outcome or the other is fulfilled…

Have a profitable week
Ian Copsey