Friday, May 30, 2014

The next bit looks a bit tricky…

Partly good, partly not so good and partly tricky is the way I could sum up yesterday, although the general expectation of a period corrective activity beginning was absolutely right. This trickiness may well continue with some ambiguities developing and also some rather complicated structures making life difficult.

Where do I start? Well, while the Euro hit downside targets, the correction was deeper than expected. The Swissie took the option of recycling back to just below the 0.8964 low but didn’t have the structure I would have expected. GBPUSD stalled 2 points above my target although, like USDCHF, the structure wasn’t quite right. I’ll throw in AUDUSD at this point also, which broke above retracement resistance…

So there was a need to adjust and review but with the problem that we need to work with options and identify which one develops. That will be the task for today… However, whichever occurs will end up still Dollar bullish.

Even USDJPY has suddenly put in a cumbersome whip and faces the same issue. Indeed, there is little room for manoeuvre so the outcome will be decided by breaks. I’d still prefer lower but from prudence feel that we need that confirmed. Indeed, EURJPY does seem to require a deeper correction higher having reached its downside target yesterday. Whether it will be EURUSD or USDJPY that fuels that is yet to be seen. It could suggest, however, that the cross could provide input to establish the ambiguities of the individual pairs.

So, take care today and note the key areas that would make or break the alternatives…

Have a great weekend
Ian Copsey  


Thursday, May 29, 2014

DAILY FORECAST FOR EURJPY

INTRADAY CHART
BIAS: While 138.49 caps we should now see losses  through to 138.13-25 and later to 137.85-95

Resistance: 138.49 138.60-65 138.90-10 139.36-50
Support: 138.13-25 137.85-95 137.48 137.22

MAIN ANALYSIS: Losses developed as expected and should see the current move reach 138.13-25 for a correction of around 20 points before reaching the 137.85-95 area (approx.) From here we should see a correction higher but note the 138.60-80 resistance. The next decline will move down to the 137.48 projection target.

COUNTER ANALYSIS: Only an earlier break above 138.70 would risk a move back to the 139.36-50 area at least. It may even suggest deeper gains towards 140.50-94 and perhaps suggest we have seen the larger triangle low...

MEDIUM TERM ANALYSIS:
22nd May:  This persistent ratcheting lower has forced me to adjust the count. I'm still quite cautious with the structure having been very erratic and thus difficult to be certain of the count. I note we have reached close to the 138.00-10 target which I suggested as a potential daily triangle low. We do have hourly & 4-hour bullish divergences which provide a warning. Until a break above 139.50 we still need take care in case we see a move down to 137.79-99 (max 137.48...) These next moves will be important.

Good trading
Ian Copsey

Approaching a corrective phase

Yesterday’s Dollar strength was just as the doctor ordered and in line with the type of solid moves as I suggested. We are now approaching a series of projection targets that will begin to slow the move with a higher level of corrective activity. However, these projection targets are in the sections that normally have a greater accuracy in identifying both the projection target areas and also retracements. The only potential complications are the structure of the corrections – simple or complex. Thus, it’s more beneficial to note reversal indications towards the outer limits of the anticipated ranges.

The Europeans saw steady (Dollar) gains although USDCHF still proceeds within a rather claustrophobic manner. Still, it is developing within the confines of the structure I have been following and therefore provides confidence. GBPUSD accelerated lower nicely, perhaps a little more directly than I had expected, but certainly to the lower target projections.

AUDUSD has made its decision to join in with the Dollar strength although the structure has displayed a higher level of volatility, and something that looks like continuing. Therefore, take care as this does suggest a higher degree of risk in terms of stop losses being hit…

USDJPY has baulked the Dollar bullish trend but as pointed out yesterday the 102.13 high did satisfy the correction, the break below 101.72 providing the signal. This should see follow-through but only after completing a correction. This part of the decline should be watched with care as it’s one where there is no single target and therefore a lot of attention must be made to momentum conditions in the general target areas. This could have a knock on effect in EURJPY that is now approaching a series of projection targets, rather similar to EURUSD, that will maintain the general downside but likely suffer a period of corrective activity.

Thus, this should be a different day compared with the past two days. Take note of anticipated range extremes.

Good trading
Ian Copsey  


Wednesday, May 28, 2014

Follow-through-follow-through

On the whole everything went close to plan yesterday with the exception of GBPUSD and AUDUSD. Perhaps ironically, the development in GBPUSD provides a stronger outlook than I had originally anticipated – but one that makes more sense in the larger wave degrees.

Broadly, following the long weekend that allowed price to dabble with the 4-hour Price Equilibrium Clouds, we have seen the Dollar make further gains as anticipated and took price away from the hourly Clouds initially but are now providing Dollar support on the correction. This is encouraging the potential for a move away from the 4-hour Clouds again. We now just have to see further progress otherwise we could see a period of consolidation/correction.

AUDUSD was the other surprise, not one I had expected but in terms of levels that would cause a reversal this has not been seen and should not be seen. This appears a mild detour from the ideal but still within the broader structure I am following. Thus, retain the basic expectation that I’ve been detailing over the past few days.

USDJPY has done enough on the upside now. That doesn’t rule out any further gains within the limits I have been advising. However, we should soon see further progress in the larger picture. Given the rather introverted manner this pair has been displaying for several months now I fear more complexity, potentially choppy behaviour, that can maintain the confusion. There will be some limitations provided by EURJPY that has some more identifiable targets so matching the progress of EURUSD and USDJPY versus the cross will likely provide some clues.

We should see some decent moves today I think…

Good trading
Ian Copsey  


Tuesday, May 27, 2014

DAILY FORECAST FOR USDCHF

INTRADAY CHART
BIAS: We should now see gains to 0.8997-09

Resistance: 0.8950-53 0.8966-71 0.8984 0.8997-09
Support: 0.8939 0.8923 0.8910 0.8896

MAIN ANALYSIS: The 0.8923-38 supported and triggered gains to 0.8971 before a deeper correction. This should now see direct gains back above 0.8971 and to the 0.8997-09 area. This will probably be enough for today. However, this target should see a correction of around 20 points only before heading higher to 0.9032-37 and probably the next minimum target at 0.9062...

COUNTER ANALYSIS: A break below 0.8923-39 would revert back to a more bearish corrective mode. Note support at 0.8910 but deeper at the 0.8882 low…

MEDIUM TERM ANALYSIS:
27th May: The more direct follow-through higher is promising firmer gains to 0.8997-09 and 0.9062 en route the 0.9119-49 area - max 0.9180-90. This should see a cap and a deeper correction lower.

Only below 0.8920 would frustrate and suggest losses to 0.8882 at least...

Good trading
Ian Copsey

Follow-through

While Friday’s trading did provide a dull end to the week, yesterday’s U.S. bank holiday lull extended the same impact. Having said that, there were some telling developments from several factors: momentum remained Dollar bullish overall, failing to break below the Price Equilibrium Clouds while the Dollar has not corrected low enough to force any breaks. An even more important development was the depth of the losses in EURUSD that a infringing on earlier parts of the structure that enforce the Dollar bullish outlook. This therefore remains the dominant force. What we are now navigating are corrections across the board.

In particular the above relates to the Europeans in general and to a lesser extent to AUDUSD. The Antipodean is at a more advanced stage of its decline and currently preparing to dip its toe into deeper levels. The minor issue is that remains is whether we shall continue to see range trading or direct losses…  Overall this should still be within a bearish outcome.

USDJPY surprised on Friday, moving higher than expected and tends to point to a more advanced stage of its decline. While a stronger recovery within a decline may sound counter intuitive, we are talking of relationships with earlier corrective highs and it is this which is providing the hint. From this point we shall therefore have to tread a little more carefully as we approach the targets I set at the end of January.

Overall this should retain a bearish bias in EURJPY, both from the point of view of what should be a weakening EURUSD but also from the near-term expectations in USDJPY. This would suggest that we should see a reaction lower before too long…

While the early part of the day could remain defensive, as the day moves on we should see potential for a stronger move today.

Good trading
Ian Copsey  


Friday, May 23, 2014

A dull end to the week…

I’m quite satisfied with yesterday’s analysis. There were a few tweaks but within the options open. There is an interesting confluence of patterns that threaten to make the next day or two remain in ranges. While I use 3-wave structures in just about every are of the wave structure, when they occur at the beginning of a corrective structure that could turn complex, then the potential is for complicated sideways trading with a choice of three structures. Well, that’s what we face in USDJPY, GBPUSD, and AUDUSD. The balance in EURUSD and USDCHF remains unclear but I don’t see EURJPY reacting with any vigour… so a dull day is expected…

Out of all, perhaps it is USDJPY that has a clear direction, AUDUSD also although perhaps requires some early break of a key level to confirm my suspicions. On that note, GBPUSD could have a slightly alternative structure so will need observation to confirm its intentions.

The problem we shall face is determining which of the three structures are going to develop in each of those at risk. I shall do my best to describe the alternatives but I suggest that when coming to the point where a decision is made – either take profit if in a position, and if not, then don’t trade. At best I can provide what I think are the outer limits of these structures, but of course there are three variations so care is going to be required.

If there is any pair that could make a firmer move today (ignoring the potential for consolidation) then it’s GBPUSD. Take note of those limits in particular…

That’s about as much as I can offer today except to say that if there’s any clear trade it could be in USDJPY – but still within a complex correction…

Have a great weekend
Ian Copsey