Market Direction

[idejan]

I'm posting a long term chart of USDJPY and I'll try to write a more in detail analysis of JPY and possibly for EUR and CAD.
Looking on the shorter term chart it seems like a JPY could be reversing or at least doing a deeper corrective move toward 115, but I believe it has more on the upside so watch for a possible bounce up from 117.70/50
On the upside targets are as posted, and on the picture you can see a possible target area for ending this up trend and reversal to min 110, but probably much much lower.
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[idejan]

Originally Posted by idejan

EUR
probable consolidation up to 1.1861/1920 or little above, but I don't believe that we have a bottom here. To the downside, possible support in 1.1632/1582 area, but my most probable targets for now are just little below 1.15 (1.1485/74)
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Some details on EURUSD
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[idejan]

Hi,
Seeing that so many people actually visit this thread keeps me posting here, but I must admit I find less time doing it.
*I've written this report earlier today but had some ISP problems with connection.

USD showing "weakness" across the board. Small correction in all EUR, JPY, CAD and GBP is most possible scenario but not a reversal yet.
Critical issues that could shift the sentiment.
Focus is now off the oil prices for the time, which could be seen from CAD and JPY, and since the rate differentials are already tailored in the price, it could happen that focus could shift to structural issues.
But even that the rates differential are tailored in the prices, they could still prove to be the main driver in the months to come for few reasons.
The "cooling" of the housing market, showing the negative impact of the FED tightening policy, especially when the core inflation is below and likely to stay below 2.5%, indicating that the tightening is near it's end (and in my opinion we will most likely see a move in the opposite direction by the end of next year).
On the other hand, talks about possible moves by the ECB and BoJ could trigger positioning in the other direction. Although possible, I don't believe that move by the ECB is likely before Q2 2006, but BoJ is possible earlier in Q1 2006.
Most worrying however, is possible crash of the housing markets which could trigger more serious crisis, since it's negative impact would spread across sectors, and most important, on banks. Being the main driver of the US economy (2.25 of GDP and every 4-5 job was created by the construction and real estate) this "cooling" would show in the numbers to come, but more important it could be a significant psychological trigger. Some ease of a possible downward spiral, could provide the recovery and reconstruction of the hurricane affected Gulf areas.
Generally I don't see EUR becoming stronger in 2006 (with the EU economy staying stagnant, but stable and showing signs of recovery), but I see JPY and CAD going to build up strength and most probably heading down to below 100 in USDJPY and below 1.00 in USDCAD. This would however push EURUSD up.

EUR

Originally Posted by idejan

EUR
probable consolidation up to 1.1861/1920 or little above, but I don't believe that we have a bottom here. To the downside, possible support in 1.1632/1582 area, but my most probable targets for now are just little below 1.15 (1.1485/74)
ID

EURUSD sat on 1.1639, just little above an intermediate 38.2% fib @ 1.1632 and although the recent fall from 1.2171 in EURUSD looks like a finished 5 wave IM down which could completed the ZZ fall from 1.2587 (September high), I would say we have at least one more down to the targets in the 1.15 area on the chart below (right click and save to your desktop to be able to zoom in for details).
Targets of the correction up are on the chart, and there is a great confluence of fibs and MA's building a strong zone from 1.1808 to 1.1862
Move above 1.20 would argue a serious reconsideration of a possible bottom, and above 1.2150 would confirm that.

JPY

Originally Posted by idejan

Looking on the shorter term chart it seems like a JPY could be reversing or at least doing a deeper corrective move toward 115, but I believe it has more on the upside so watch for a possible bounce up from 117.70/50
On the upside targets are as posted, and on the picture you can see a possible target area for ending this up trend and reversal to min 110, but probably much much lower.

As I wrote in the previous post although it seems like a possible reversal, I believe that it will stay above 118.37/26 or would bounce from around 117.30 up to 120.80<>124.10 where I believe it will top.
However, it could extend lower to around 115.40 before, and breaking below that, could be some indication of a possible top, but only below 111.50/00 and preferably below 110.70 would be considered as a confirmation.
Immediate break above recent top would invalidate correction targets.

CAD

Originally Posted by idejan

Intraday will probably make a double top before it corrects to around 1.1805/1765/1737 to continue up to 1.2043 and 1.213 area.

Made a double top just as forecast and heading low to forecast levels, seeing strong confluence @ 1.1809/00 and @ 1.1765/57 target areas. It should not go below 1.1710/98 and 1.1639 low.
Immediate break above recent top would invalidate correction targets.

GBP
Just like the EUR, the last fall from around 1.79 could qualify for a finished IM move down, but I would say that after a probable correction to 1.725/73, we would most likely see at least on more dip down targeting 1.69/68 area.

ID

[Trader01]

For Eur/Usd I have pretty much the same targets as you do for this current short-term upside correction.

Then we continue down to:


1660 ..... probability of reversal 30%

1560 ..... probability of reversal 50%

1380 - 1407 ...... God sits there with benevolence; but he is known to have abandoned us during George Bush's reign.

Don't know where we're going, but where we was, wasn't it!

[Trader01]

Idejan,

I have purchased a bottle of aspirin for use when I read your charts. I now have only 5 tablets left and am seriously considering supplementing this vitamin dosage with medicinal morphine.


Let's take a look at Usd/Cad:

I believe a LT bottom is either in or is almost in.

Sept 30-Nov 15 leg is wave "a" of a likely abc for the current wave (iv).

Wave "b" is in progress to around 1750.

Then wave "c" to top off (iv).

Then final descent to 1600s or thereabouts for (v). This completes (5) down.

Your comments please -- don't be shy to hurt my feelings; feel free to correct my mini-count for this last leg.

If you are going to post a chart as part of your response please keep in mind Dr Forex's South African axiom #3:

"By the time a technician gets done with a chart it is no more a piece of rapturous art -- it has then been transformed into chaos that can both ruin the eye and deaden the soul"

Your efforts are much appreciated; may you wake up tomorrow and be surrounded by 10 ravenous women!

[idejan]

Originally Posted by Trader01

Idejan,

I have purchased a bottle of aspirin for use when I read your charts. I now have only 5 tablets left and am seriously considering supplementing this vitamin dosage with medicinal morphine.


Let's take a look at Usd/Cad:

I believe a LT bottom is either in or is almost in.

Sept 30-Nov 15 leg is wave "a" of a likely abc for the current wave (iv).

Wave "b" is in progress to around 1750.

Then wave "c" to top off (iv).

Then final descent to 1600s or thereabouts for (v). This completes (5) down.

Your comments please -- don't be shy to hurt my feelings; feel free to correct my mini-count for this last leg.

If you are going to post a chart as part of your response please keep in mind Dr Forex's South African axiom #3:

"By the time a technician gets done with a chart it is no more a piece of rapturous art -- it has then been transformed into chaos that can both ruin the eye and deaden the soul"

Your efforts are much appreciated; may you wake up tomorrow and be surrounded by 10 ravenous women!

I like your stile definitely , maybe we should consult on data and you do the writing... we could then consider choosing some exotic guru nick and start a new thread. But I doubt you need any medicine considering were you live .
I only wish I wake up tomorrow surrounded by 10 ravenous women, or to paraphrase Woody Alan "...18teen year old blond Swedish stewardesses hungry for sex...", but on some warmer place as today we got the first snow.
As for the charts, I look on 4 charts different time frames for every pair, and it's difficult to put all I see on 4 charts in just one ...but consider it as just a sample.
Now some brief overview.
Seems that cooling could turn freezing, just to many layoffs around... GM, Ford... nobody talks about the layoffs in construction, but with all that cooling I just wonder... and then banks heavily exposed into mortgage related securities, are banks the next news topic? But no problem. There are so many foreign investors not getin it yet.
With Americans turned into "spendoholics" and with FED yet ready to trow money from helicopters (the man had a vision, and now he could fulfill it), sounds funny to suspect even an "D" of "Deflation", but what about hyper-inflation? It's always good to consider all options. Although I use official data, I also consider some other figures too. For example while core rate is now around 2.1% and CPI 4.3%, using pre-Clinton methodology CPI is above 7%.
... Another indication is Gold, made $38 or around 8% to a new high, from my Nov 7 call. Not that good on Crude as it made new low some $3 down since than.

Where do I start ... CAD first, to answer your question.

Originally Posted by idejan

CAD
Made a double top just as forecast and heading low to forecast levels, seeing strong confluence @ 1.1809/00 and @ 1.1765/57 target areas. It should not go below 1.1710/98 and 1.1639 low.
Immediate break above recent top would invalidate correction targets.

First, it just played my scenario, double top, down to first target @ 1.1809/00 but did not stop there and is now sitting on the second target 1.1710/698 (I see I've missed that "6" in the previous post but I hope you all figured out your self). So even with crude falling CAD made lower, which could indicate USD weaknes more than I expected.
Now about your count. My preferred view for now is that we have a larger correction from Nov 2004 and that we are now in a last c wave of that correction. This Sept 30-Nov 15 leg could be wave A or W of that larger c, and this drop should complete a possible B or X, but in one other scenario we could see two more legs before that B finishes, if dollar weakness continues, probably making a double bottom in such case (IM structure of the last drop is not typical for B waves unless it is a first subwave a of that B, thus indicating two more legs - b&c).
However if you consider the drop from May '05 an IM wave down, continuation of the larger down trend and not part of the correction, then the recent correctional wave iv could be considered finished, in which case the last drop looking as an IM, fits in the scenario, and a break below the Sept '05 Low should confirm that. In that case wave v of this drop from May, could be aiming 1.16/14 zone (I'll provide more precise price targets later).
But as I've said previously in post #52, even that it could be analyzed as an IM wave down (drop from May '05) it has too much overlapping and running B's so I'm considering it as a finished DZ (Double ZigZag) rather than IM for now, and latest development from the Sept Low, as a last wave c of the larger degree correction targeting min of around 1.215 but probably higher to 1.23-25

EUR

Originally Posted by idejan

EURUSD sat on 1.1639, just little above an intermediate 38.2% fib @ 1.1632 and although the recent fall from 1.2171 in EURUSD looks like a finished 5 wave IM down which could completed the ZZ fall from 1.2587 (September high), I would say we have at least one more down to the targets in the 1.15 area on the chart below (right click and save to your desktop to be able to zoom in for details).
Targets of the correction up are on the chart, and there is a great confluence of fibs and MA's building a strong zone from 1.1808 to 1.1862
Move above 1.20 would argue a serious reconsideration of a possible bottom, and above 1.2150 would confirm that

Since that post EURUSD got right to the first target on the chart, fell strongly down, and made new high right on the second target from the chart. This should have finished this correction and the recent high should hold, but any decisive break above 1.1865, could target 1.20 to 1.2050 with just below 1.2 being the most probable in such case.
Break below 1.1639 should confirm 1.15/14 targets.

I meant to write just a short overview along the answer to your question but it turn more.

JPY

Originally Posted by idejan

JPY
As I wrote in the previous post although it seems like a possible reversal, I believe that it will stay above 118.37/26 or would bounce from around 117.30 up to 120.80<>124.10 where I believe it will top.
However, it could extend lower to around 115.40 before, and breaking below that, could be some indication of a possible top, but only below 111.50/00 and preferably below 110.70 would be considered as a confirmation.
Immediate break above recent top would invalidate correction targets.

Nothing to add to the above. Made a low little below that 118.37/26 level @ 118.19 and still trading above. If it goes below that, than 118.10/00 and 117.70 are the next support and possible reversal up points.

GBP

Originally Posted by idejan

GBP
Just like the EUR, the last fall from around 1.79 could qualify for a finished IM move down, but I would say that after a probable correction to 1.725/73, we would most likely see at least on more dip down targeting 1.69/68 area.

Just after my post GBP went right to the target @ 1.725 (1.7245 actual) drop almost 200 pips and bounced back to new high, and if that high breaks, than we could see min of 1.7340 to 1.7480/90 but could go to around 1.7580
If it holds, then we could expect fall to 1.69/68 area

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[idejan]

No edit? it seems it has been turn off.
Sorry WODY ALLEN , I scriblle when I write (I wrote Woody Alan)
I checked numbers but not your name

[idejan]

And ooh, one more thing... Tommorow's Money Supply. Thats were the inflation is coming from, not rising prices. And who's behind Money Supply and who is fighting inflation?
Happy Thanksgiving to all (that matters).
(me, I'm ortodox)
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