Welcome back to a new week.
Lets see if we can make some sense of the action today,
I know that there are some big moves about to get underway, Gold and Silver are the most immediate examples.
I think this weeks action will bring those big moves into focus.
So lets get down to it.
EURUSD.
EURUSD 1hr.
EURUSD 4hr.
EURUSD daily.
Despite EURUSD falling to a new low today,
the price structure still fits a three wave decline off the wave (a) high.
And wave (c) is expected to rally over the next week towards teh 1.1100 target area.
The overall correction in wave [ii] will complete an expanded flat correction at that point,
and we can then look lower again in wave [iii] for the longer term.
The alternate count is calling for a rally also,
but this rally would be a three wave correction in wave (ii) up to about 1.1020 this week.
If this count is correct,
then wave [iii] is already underway
and we can expect a continued decline in wave (iii) beginning later this week.
Tomorrow;
for the moment both wave counts call for a rally to complete a corrective second wave.
Watch for that rally to begin tomorrow with a push above 1.0950.
GBPUSD
GBPUSD 1hr.
GBPUSD 4hr.
GBPUSD daily.
Cable is holding pretty flat today,
after completing a possible fourth wave correction at 1.2345.
The drop off that high may be the beginning of wave ‘v’ of (i).
So I would like to see wave ‘v’ continue lower tomorrow
to break into the 1.21 handle before completing wave (i).
Given that the previous wave (c) was quite a rally,
I would like to see wave (i) retrace a large amount of that rally,
if not all of it!
Then wave (ii) must create a lower high before wave (iii) of [iii] carries the price mush lower.
Tomorrow;
watch for wave (i) to continue the decline below 1.2200 to complete five waves down.
USDJPY.
USDJPY 1hr.
USDJPY 1hr.
USDJPY daily.
The market has not yet created a definite top for wave [b] just yet.
Todays high was fractions of a pip below the high created on Friday.
So Fridays high still counts as the final high for wave [b] for now.
I am reasonable confident that wave [c] of ‘B’ will begin this week,
but I need to see a drop back into 107.40 to signal that wave [c] has begun.
Tomorrow;
Watch for wave [c] to begin with a spike lower to break 107.42.
DOW JONES.
DOW 1hr.
DOW 4hr
DOW daily.
Todays rally has perplexed me to be honest.
The rise is in three waves,
and the declining trend line still holds.
But the market has refused to drop into a third wave down as yet.
This action does draw the bearish count to the edge of reason,
but it does not completely rule out a wave (i) decline.
So I remain open to that decline coming in strong this week.
If we continue to see the main impetus of the action to the down side,
then I will hold with the bearish count.
If there is a sharp rally above 27100 again,
that will trigger the alternate count shown.
And the recent sideways action will be labelled as a fourth wave triangle.
With wave [v] of ‘5’ yet to come.
This is disappointing I admit,
but a rally to a final high in October has happened before with terrible consequences.
Tomorrow;
Watch for wave a break of 26700 to confirm wave ‘iii’.
27100 must hold.
GOLD
GOLD 1hr.
GOLD 4hr.
GOLD daily.
The drop in Gold today has ruled out the triangle correction for wave [iv].
The price broke 1483 and has hit the lower trend line of a trend channel.
This action has triggered the alternate count for wave [iv]
which shows a flat correction 3,3,5 structure now completed at the session lows today.
The price has bounced again off the lows this evening which is an encouraging sign.
If the price rallies above the 1500 level again,
that will signal that wave (i) of [v] has begun.
Tomorrow;
I expect wave (i) to begin this week,
but we will have to wait for a bullish higher low to form
to be sure that the market has turned.
Watch for a push back towards 1500 tomorrow to get that turn underway.
CRUDE OIL.
CRUDE OIL 1hr.
CRUDE OIL 4hr.
CRUDE OIL daily.
Crude has not stopped the drop in wave [i] yet.
This is not a bad thing in terms of the larger trend change into wave ‘3’ down.
As I would even prefer wave [i] to break below 52.70,
before any correction in wave [ii] begins.
a break of that level in five waves would really favor the bearish outlook.
I think we are getting close to the end of wave [i] now though.
And we should see five waves complete early this week.
Tomorrow;
Watch for a break of 52.70 at the previous wave ‘b’ and for wave [i] to complete in that area.
The lower level of 50.50 will offer significant support to wave [i].
S&P 500.
S&P 500 1hr
S&P 500 4hr
S&P 500 daily.
Still no luck on wave ‘iii’ down.
And as with the Dow,
the failure to drop impulsively in wave ‘iii’,
means that the alternate count has not been killed off just yet.
Only a sharp move lower in wave ‘iii’ now,
that breaks below the 2900 level again will save the bearish outlook.
I remain hopeful that can happen soon,
so long as the upper trend channel line holds.
Tomorrow;
Watch for Fridays highs to hold again and a sharp move lower to continue wave (i) down.
SILVER.
SILVER 1hr
SILVER 4hr.
SILVER daily.
Silver fell today again which has created a extension in wave ‘v’ of (c).
Wave (c) is now close to reaching equality with wave (a),
and the pattern off the high is a clear three wave flat correction.
so we are very near to the end of this correction in wave [iv].
If this count is correct,
then wave [v] up should begin this week.
Wave (i) of [v] will likely reach the high of wave (b) at 18.74.
But I think we will see a spike higher in wave ‘i’ of (i) over the coming days.
Tomorrow;
watch for wave (c) of [iv] to complete and turn higher in wave (i) soon.
U.S 10YR.
US 10YR 1hr.
US 10YR 4hr.
US 10YR daily.
There was a very shallow trade today in Bonds
which indicates that the correction within wave ‘i’ of (iii) is still underway.
The price must complete this correction below 130.78,
and then turn lower again to break 129.11 to signal that wave ‘i’ is in force.
I expect the downside action to resume soon and wave ‘i’ to complete by the end of the week.
Tomorrow;
Watch for wave ‘i’ to continue lower and break the wave ‘b’ low at 129.11 again.