Just about time to go Long EUR$. First target is 1.3804.

Am still long EUR$. If 1.3630 level is broken to the downside the wave count will require a re-assessment.

mnadii did you take a long position in gbp/usd on Monday.

OUTLOOK FOR WEEK 26TH - 30TH MAY, 2014

I hope you have had a wonderful week.

We are at very interesting junctures in EUR$, GBPUSD and USDJPY. I.e the pairs that I am having the pleasure of analysing as below. Criticisms are encouraged.

EUR$



It appears that waves [i] and [ii] are complete in the EUR$. Wave [ii] took the form of a zigzag ( i.e an impulse for (a), a triangle for (b) and an expanding ending diagonal for (c) ).

Wave (i) is from the 1.3734 high to 1.3615 low. It has taken a leading diagonal structure.

I expect a correction for wave (i) to be superquick and reach about 1.3689 level. Once this correction is over there should be a dramatic fall in the pair as wave (iii) down develops.

1.3734 level is our line in the sand and should not be broken to the upside.

SUMMARY:
Beginning Monday 26th, EUR$ should rally in a move that is not expected to reach 1.3734 level. The pair shld then drop sharply.

RECOMMENDED STRATEGY:
Going into early next week traders shl'd accumulate short positions with a Stop Loss level at 1.3734. NB. PLS note that diagonals are usually deeply retraced so the 78.6% retracement of wave (i) at 1.3708 may be reached.
Of course the higher the level at which you get in the better for your risk:reward.

USDJPY



In a previous post I may have spoken too early calling for a short in the $YEN pair but the opportunity should be at hand now.

From the 103.01 high the pair appears to have also traced out a leading diagonal to the 100.81 low. As expected, the correction has been quick slightly exceeding the 50% level at 101.91. Wave [A] is impulsive and [C] is an ending diagonal. For all intents and purposes wave ii, the correction for wave i (103.01 to 100.81), is complete at 102.00 level.

The outlook for next week is a BIG sharp drop ( there is likelihood for a gap down). It's possible for a move to 102.17 (the 61.8% retracement of wave i) also, but no more higher than that.

STRATEGY:

$YEN should be shorted at current levels i.e 102.00s. Depending on the gap, if it appears on Monday, the Stop Loss level shl'd be at 102.20 level. A big down move is expected.