Thursday, April 30, 2015

DAILY FORECAST FOR USDJPY

INTRADAY CHART
BIAS: I expect a correction initially followed by firmer gains

Resistance: 119.15 119.35 119.55-65 119.80-85
Support: 118.77-86 118.60 118.32 117.91-00

MAIN ANALYSIS: Yesterday worked well - a move to just above 119.28 that then triggered losses back to between 118.52-77. So far we have seen a move to 119.15. This should see a correction lower. These are always difficult to judge but watch the 118.70-90 area for signs of a reversal higher. From this low we should see a move above 119.35 - but may not be by too much 119.35-55 perhaps - for a correction and then up to the 119.65-85 area approx - for a modest correction and finally up to above 120.09 and I suspect to 120.15-35. This will be important - note momentum. If a bearish divergence is formed and a reversal pattern the next move could be to new lows.

COUNTER ANALYSIS: Any break above 120.40 -60 would test the 120.84 high and then move higher towards the 122.02 high.

MEDIUM TERM ANALYSIS:
29th April: The entire structure is up in the air right now and I'm also looking at potential for a move to 115.01. However, I don't want to make any definite calls on this at the moment. Suffice it to say that the recent development has been crazy and needs greater confirmation in whichever direction. As a basic idea, it'll take a break above 120.84-00 to raise the chance of gains and below 118.32-52 to suggest the recycling to the 115.01 area. 

Good trading
Ian Copsey

Perhaps I need to see a shrink…

Something like 2 – 3 weeks ago I was calling for EURUSD to reach current levels. It was the depth of the drop from 1.1052 that threw me off course and left me with tooth marks in my left buttock. It was then that I considered a triangle and subsequently had my right buttock bitten. As you can imagine, I tend to sit uncomfortably at present.

Dare I suggest that we’re now in a zone in which we should begin to see a topping pattern develop. Certainly, 4-hour momentum across the board is not really providing any suggestion of a reversal but I am expecting some corrections as we start the day. This is reflected in the three Europeans. So I expect more two-way trading over much of the day.

The Aussie is in a tight situation. There’s a great hourly bearish divergence although 4-hour momentum has not really provided a signal. It would be preferable to see a minor new high in what looks to have been a recycling in an expanded flat. So that tends to reflect the same as the Europeans.

Even the Dollar Index is now testing levels I’d suggested 3-weeks ago, but caught me in the same manner as EURUSD. Therefore, across the board, we do seem to have consistent indications suggesting the correction is close to completion.

In USDJPY yesterday, I ventured to suggest that we needed a deep correction higher – but remaining below 119.43 and for losses to move to between 118.52-75. I was rather concerned with the precise requirement for the target but it worked pretty well and should now see further gains. How far this will get is going to be the question. We need to watch for later indications of whether it intends to extend higher – or reverse back lower.

Clearly, with EURUSD in such a buoyant mood, EURJPY lapped up the support. However, it is now approaching a natural resistance area – which looks to be right in time for EURUSD to consider a reversal lower…

While I have sore buttocks, I do feel some encouragement with the general correlated view from this point.

Good trading
Ian Copsey  


Wednesday, April 29, 2015

The market needs to see a shrink

I produce a weekly report on Tuesdays, and for the past three weeks the structure I’ve been following has come to a point on those days where I can see a potential impulsive structure (first two weeks) and yesterday I had resigned myself to a larger consolidation. I woke up on each following Wednesday and have seen my outlook totally blitzed. What is it with Tuesdays…? The mention of psychotic comes to mind again…

While I have not studied this concept, I was advised that from one month ago that we are in a 2-month period of an “inversion cycle.” During these periods the market goes berserk. Indeed, when I look at the lower degree development, the noise (degree of swings – high levels of near-term up & down gyrations) has been horrendous, particularly in Forex although I had caught the U.S. indices quite well… until yesterday. That too, has suddenly generated a freak move that doesn’t seem to fit in.

And there’s another month to go…

Therefore, the main theme for trading is – forget trends – even if you find after taking a profit that you could have made more. There are more risks of being whipped out. Momentum is also not really reacting as it normally does in terms of identifying corrections/reversals.

Having said that, there is a greater indication that the Dollar wants to weaken further. In particular, I have come to the conclusion that GBPUSD has found its major low already. It actually stalled in an area I had expected some months ago but the final decline lacked alternation… and that screwed up the normal development.

Overall, wherever there is a suggestion of a reversal – have it confirmed. The past few weeks have proven that we do not have a “normal” market… Play safe.

Good trading
Ian Copsey  



Tuesday, April 28, 2015

WEEKLY OUTLOOK FOR THE DOLLAR INDEX

INTRADAY CHART
28th April:


The Wave ^C actually dipped a little further than expected - to just above the 85.4% projection. This should therefore see a 66.7% -76.4% projection in Wave ^D to the 99.01-39 area. This should then require one final ABC lower to complete Wave ^E - probably around 66.7% projection. This will form daily (green) Wave iv to allow the rally to resume in 3-waves to the Wave -iii- target.

Good trading
Ian Copsey

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