Friday, August 26, 2016

Busy going nowhere…

Gee, we could have taken the day off yesterday. Dull… but then it’s still August. I am expecting things to hot up a bit more, not particularly immediately but at some point in September. However, today I can’t see a similar day to yesterday. In fact, in some ways, the fact yesterday was flat really made the analysis easy today … because nothing has really changed. Yes, it wasn’t what I had wanted but did know there was the risk of deeper pullbacks – and that was what we saw yesterday.

If there are any doubts in my mind it will be because of the apparent degree of movement required across the pairs. First things first, the key pair that can provide a key barrier is in USDCHF, as I have been mentioning. This still needs some Dollar bullish development and we’re going to have to watch all three Europeans achieve their targets. Once that is done we can see a more constructive development.

This same outlook is relevant in AUDUSD also. It doesn’t have a pretty structure but it is valid. Obviously we need take care of the key break points, but as long as the above is correct we should see the outcome I have been expecting.

As for USDJPY… well, it shot up in early trading yesterday, making me feel we should see the next move … but then it seemed to find itself lost in a maze. There’s no real break of my scenario but it certainly doesn’t have much room before the structure breaks. On top of that, with USDJPY appearing to be working in opposition to the Europeans, it gives me a headache in EURJPY. Frankly, I think we need to sit back and watch these two pairs and wait for it to commit to one direction or another… Once that occurs we should be able to move on from there…

Have a great weekend
Ian Copsey  

Thursday, August 25, 2016

Consistency across the pairs

The heading is basically correct – I think at least … but there is one outlier in GBPUSD that could buck the trend – or I may have screwed something up.

I had some doubts yesterday morning – mostly because, when I started in the morning there were chances of Dollar losses although I knew we could see direct Dollar gains. Very clearly, the Dollar did make a direct move higher so all was well. That GBPUSD chose to buck that trend was the surprise package. In some respects there is a similar conflict at the start of the today - but pretty much the same as yesterday. I have some rough targets I am looking for but there’s one pair – USDCHF where I can identify a more accurate stalling point. I’d suggest that you keep that target in mind, as it’s very likely that the other pairs will stall around the same time.

I’m also quite intrigued how the U.S. indices have managed to correlate with the Dollar and I can see this continuing over the coming week. This coming week-10 days does appear to be promising some coordinated moves in both the Dollar and the indices.

As I have described the Europeans, the Aussie has joined the European bunch in a similar outcome. I’m not sure whether the barrier in USDCHF will mean much to the Aussie, but if you can read the wave structure – even match potential similar momentum patterns, this could help the process of identifying stalling points…

USDJPY performed really well too – but not quite in EURJPY. It’s the cross that has some uncertainty and I’d suggest standing back while the other pairs develop. For USDJPY, the perfect development does point to the targets I indicated yesterday. Thus, keep track there as I feel this could be a key day…

Good trading
Ian Copsey  

Wednesday, August 24, 2016


BIAS:     We should be focusing on the downside today

Resistance: 1.3209-14 1.3234-48 1.3275-80 1.3300-05
Support: 1.3170-75 1.3145-50 1.3120 1.3100-05

MAIN ANALYSIS:   While the 1.3170-75 support holds there may be an argument for a minor new high between 1.3209-24. However, I have my doubts. That there is limited upside suggests we should not be looking for strong gains. A break below 1.3170-75 would signal losses down to 1.3120 at least - potentially as deep as 1.3100-05 or 1.3080-85. We should be looking for bullish reversal indications that will eventually take us to around 1.3324 at least.

COUNTER ANALYSIS:     A direct break below 1.3022 - and allow for 1.2990-00 - would surprise and suggest stronger losses below 1.2973 and below…

Good trading
Ian Copsey

Be wary today

 There appears to be something afoot… something not quite right. I can’t say yesterday was exactly as planned. It started off quite well but then the general balance between the pairs began to creak at the edges. While the Dollar dipped lower for much of the day, as I had been looking for, it tailed off by the end of the day. That has left USDCHF lagging well behind EURUSD in terms of direction and has begun to sniff out the 0.9648 high with the 0.9656 high only half a sniff higher. Thus, when EURUSD failed to make a new high it begins to put doubts in my mind. Equally, when considering the Europeans as a group, GBPUSD has also begun to struggle. There may be some further Dollar slippage with reversal indications not really very strong but, as I mentioned, I feel a little wary of committing to a firm outlook today.

Even the Aussie has a duality to it. Yesterday’s recovery was particularly ambiguous. I wanted to call it as an impulsive rally but there were too many twists and turns to be absolutely certain of this. This either means we’ll see a correction lower and followed by a second rally – or direct losses. It’s actually difficult to be certain of which will occur. Thus, don’t over-do the position size until there is a stronger signal.

Guess what? USDJPY is also ambiguous… However, even if it sees a break below yesterday’s low, it won’t be by much and more likely we’ll see gains develop. Then we’ll need to work with a vague EURJPY. I have been expecting a break above 114.02 but the market appears to have a slight reluctance to push higher. I think this may provide some gains but it very much depends on how strongly EURUSD will perform.

In summary, it’s not an easy outlook today. I’m pretty certain of the larger picture but today could provoke some messy surprises…

Good trading
Ian Copsey  

Tuesday, August 23, 2016

Steady trading

 Getting back after a break always takes time but I was mostly comfortable with yesterday’s analysis. There are still some blind spots where I have doubts but for the most part I am quite content with the outcome.

Covering the Europeans first, I was very happy with the outcomes and frankly the analysis I provided yesterday still very much applies to today. Perhaps there could be a few small snags but overall the outlook appears stable. If there is any concern, it could be in USDCHF but I’d still suggest that the directional bias outlined remains the same – it’s just a matter of whether we see a shortfall today or the outcome I had expected. I still tend to go with yesterday’s outlook but do take care.

This keeps EURUSD and GBPUSD on track. I don’t expect a strong follow-through today but there should be some but coming to the ending phase there is risk of complications should there be complex corrections standing in the way.

AUDUSD… well, I hadn’t expected much yesterday and it exceeded in proving me right apart from the deeper pullback than expected. Otherwise there’s no great change here and tends to follow the same template as the Europeans.

USDJPY… this was the one that failed and from the reversal from yesterday’s high there’s every risk of further complications. I’d suggest skipping this pair for today until there is a stronger structure that emerges. That EURJPY failed to follow-through on the upside was disappointing but there is still a chance that yesterday’s analysis will still develop. It tends to suggest a rather static USDJPY. It will be well to understand the implications of certain levels that would trigger follow-through.

I suspect a steady day, perhaps with some complications again today…

Good trading
Ian Copsey  

Monday, August 22, 2016

Another detour…

The additional weakness in the Dollar against the Europeans was blow and hails back to two months ago when we witnessed the Brexit outcome that generated an enormously complicated and rampant decline in both EURUSD and GBPUSD. The result was a series of sharp moves that, in the 5-minute charts, had to provide a daily outcome. I had thought that it has been put to bed but it seems that it has come back to bite my backside once again… Interestingly, I was looking at GBPUSD before my breaks and had tentatively considered that it needed a deeper pullback higher and found this conflicting with the Continentals. So there was a slight doubt in my mind but wondered whether any independent catalyst might cause it to temporarily de-link from the Continentals. Well, the Continentals resolved that outcome…

Having seen last week’s moves, it seems to me that we still have a little way to go, perhaps over the next 2 weeks or so to complete this Dollar bearish move. Alas, this will also imply that the daily consolidation that has lasted since February 2015 will continue in EURUSD for a while more.

For today, the outlook appears limited in direction – and more likely we’ll see a two-way move in the Europeans.

USDJPY also disappointed with its additional decline – although I had found the bearish structure ambiguous, so was cautious. I went through the analysis on Saturday and looked for the upside to develop and this morning’s gap higher has done the trick. Still, there’s no concrete certainty that it will rally firmly at this point. Such has been the complications in this pair. If we look at EURJPY, it is still quite ambiguous. Yes, I had decided that it had to move higher today but it still requires a more definitive break from the range of the past two weeks. Still some caution required there…

As for the Aussie… Heck it’s a mess and the drop from 0.7755 is hard to describe as impulsive… Having said that, it does look like it could see losses today… but take care…

Have a profitable week…
Ian Copsey  

Thursday, August 11, 2016

Stretching the limits

Corrections can be terribly difficult to judge and that showed through yesterday in several pairs. In some cases the fine line between impulsive and corrective has been tested to the full. Consequently, and quite obviously, we have to be on our guard. In other cases we have seen a deeper move than expected but on the basis of a rather difficult structure that could be taken in two ways. Even then, a break in the wrong direction is going to have quite an impact. As such, the initial moves today are going to be important…

Of course, the summer market – apt to see liquidity suffer somewhat – can also take a toll on the structures in terms of pushing the limits to the extreme. Therefore, don’t be too hasty but also ensure you allow for an adequate stop loss or perhaps start a trade with a smaller position. Other than that, the economic data releases over today and tomorrow don’t appear, at least, to suggest any significant catalyst.

So, we should hopefully see a more positive outcome today but whether it makes heavy weather of any reversal in order to construct the initial foundation waves is a factor to also consider. Indeed, this would seem to be the more likely development unless a larger catalyst raises its head.

Certainly, go in with caution but wait until a stronger foundation has developed to add further risk.

Good trading
Ian Copsey