http://news.ph.msn.com/b...x?cp-documentid=4380915

But the euro keeps rallying. Just perfect?

http://4.bp.blogspot.com/_MmyNT...2-paperecon_full_380.png

@fxtech - Note the narrowing bollinger bands - breakout soon. VIX is the opposite of global stocks. One of them is going to win. My bet is stocks plunge from next week.

Interesting correlations today. Dow Jones touches 11000 and is immediately rejected below opening price forming an inverted hammer on the daily. S&P500 too is forming an inverted hammer on the daily. EURUSD is rejected @1.40s and is also forming an inverted hammer and the rejection of EURGBP at 0.88 confirms short term topping. We are nearing trend reversals and the bulls have until tomorrow to negate this effect. If indeed stocks reverse tomorrow and into next week, the $ should rebound. I'll be looking to short AUDUSD and EURUSD though small size on AUDUSD since monthly objective points to 1.0070s. On stocks, already short Nasdaq and FTSE waiting for S&P to rebound to 1160 tomorrow, HangSeng if it hits 23100 and AUS200 at 4700 overnight in Asia session as pending orders.
AUDCAD and AUDNZD have simply refused to be sold and have retraced all their Tuesday losses! AUDCAD has tested parity again and squeezed all the Tuesday shorts. Topping signs. I've raised all the AUDCAD long stops to 0.9880 since a reversal on a double top is very swift with the monthly objective at 1.0060 which is equal to the upper bollinger band. The monthly elliot wave count from the April 2008 lows is now complete and a retrace for an ABC setup is very likely. On fibo measurement the retrace should fall to 0.9430s - 500+ pips. Depending on the account size you trade this could be $50 - $50,000 profit.

Significant esp long term, but will as usual be ignored (short term) by the market before reality hits home - http://finance.yahoo.com...o-apf-874601126.html?x=0

EURUSD under pressure in London session as the USDCHF looks poised to turn bullish. EURUSD has closed at high lows for 24 daily sessions. If it closes below 1.3865 that should break the high lows pattern and increase selling pressure. I'll be watching this level at the daily close to confirm shorting any of the euro crosses this week.

http://www.elliottwave.com/imag...eeupdates/dollardoom.gif

Interesting US dollar index chart pattern and bearish extremes courtesy of EWI. Speculators boosted bets against the US dollar to $30 billion - the largest shorting of the green-buck since June 2008, according to the Oct 6 2010 Commodity Futures Trading Commission (CFTC) COT report.

In June 2008 the bearish extreme was 6% while in Nov 2009 it was 7%. This October it is 3% - lowest ever bearish reading, but the index rate is higher than in both 2008 and 2009 extremes. Bearish and bullish extremes are major warnings of a sharp retrace or rebound. The euro and the aussie are the most bullish extreme against the US dollar. When the dollar rebounds, these two currencies will retrace sharply.

@fxtech - EURUSD is still printing higher lows for the 27 session running and now above the 1.4000 level objective and delaying my euro cross short trades. There is still some room for 1.4100 level to be broken as well as the AUSUSD to break above 1.000 (parity).
For the monthly (November) trade setup - the AUDCAD is the best for shorting - assuming it closes the month with the current hanging man formation at the current yearly highs.