It is a valid case Microsoft has considered.. SP Designer won't let you create item in same list from a workflow if it executes on item create event.Reason being it will go in infinite loop.
Follow this approach:
1) In Original list create a hidden column for you reference. Say Yes/No column
2) Create a temporary list say "Temp"
Create 2 columns.
OriginItemID : Type Number
Copied : Yes/No default to No
3) Now in your original list workflow Copy current item ID and store in new Temp list say under 'OriginItemID' column.
4)Create a workflow on Temp list (To be run on item created only). Set Yes to Copied column
5)Create another workflow on this Temp list(to be run on item modified only) which will copy Item from Original list based on OriginItemID column of its item. And make a copy of it in original list..along with it provide No value to the Yes-No column. .Make sure this block gets executed when Copied column is Yes
Once copy is created, make Copied column value to No.
6) In original workflow at the initial put condition if (hidden column is Yes) then only execute remaining code.