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Hi there welcome back to a new week.

As if we didn’t need another hint at the every increasing market bifurcation, as in companies that operate in the real world VS the BIG 5 FAAMG cabal.

Here is a very interesting piece on zerohedge that I cant help bu share tonight.

Q4 Earnings Shocker: Excluding The FAAMGs, S&P500 Net Income Is Down 7.5%

If you lose the big 5, the market is toast!

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EURUSD.

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EURUSD 1hr.

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Despite a spike to the downside today in EURUSD,
the main focus for this weeks action is to the upside in a possible second wave correction.
Momentum on the 4hr chart is still pointing to the upside after reaching an extreme oversold position last week.
And the wave count needs a corrective rally in at least wave (ii)
to re-balance the oversold position,
before returning lower again into wave (iii).

The alternate count is still very much a possibility now,
and the size of the retracement higher over the coming days will indicate which wave count is more possible.

Tomorrow;
I think a break above 1.0878 should confirm wave ‘a’ of (ii).

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GBPUSD

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GBPUSD 1hr.

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Cable created a slight higher low today after a three wave correction late last week.
The pattern in wave ‘c’ is not developing in five waves so far.
The sideways move over the last few sessions,
looks more like an internal ‘b’ wave correction rather than anything else at the moment.
so there is a rising probability that wave (i) is a complex flat correction.
Where ieach internal wave will trace out a three wave move.

Tomorrow;
watch for wave ‘c’ to resume its move to the upside.
The minimum target remains at 1.3283.

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USDJPY.

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USDJPY 1hr.

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USDJPY is still moving within a triangle triangle pattern today.
The last 12 days have been dominated by this triangle pattern.
So the time taken for this pattern to play out seems more in line with the wave (ii) wave count rather than the alternate.

There is an easy resolution to this pattern now.
If the price breaks above 110.13,
that will trigger the alternate count.
While a break below the 109.53 low will signal wave ‘c’ of (ii) lis in force.

After wave (ii) completes in the area of 109.15,
then wave (iii) should head higher again.

Tomorrow;
Watch for wave ‘c’ to turn lower again and hit the target at 109.15.

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DOW JONES.

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DOW 1hr.

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Although the DOW is down today,
we have not come anywhere near to breaking the initial support level at 28890 at the previous fourth wave ‘iv’.

There is of course the chance that the recent top is the final high for wave ‘v’ of (v).
But until we start to see an acceleration lower
and a break of the support levels that the market has built up over the last months,
then there is no reason to get excited at all.

Tomorrow;
If todays decline is part of wave ‘i’ pink,
then we should see a follow through tomorrow and a break below 29000 again.
We need a five wave structure to the downside in order to get serious about the downside again.

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GOLD

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GOLD 1hr.

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After today rally in gold the price is now back above the 1600 level again at least in the short term.
If this is wave ‘i’ of (v) now in play,
then ideally I would like to see a break above 1612 again in order to confirm the fact.
But today rally is a good start to work from.
Wave ‘ii’ of (v) should create a bullish higher low this week,
before wave ‘iii’ does the hard work and carries the price back towards 1650.

Tomorrow;
The previous wave (iv) completed at 1561.
So wave ‘ii’ of (v) must hold above that level.
Watch for wave ‘i’ to break 1611 to confirm that wave (v) is underway.

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CRUDE OIL.

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CRUDE OIL 1hr.

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Crude has reversed higher after a brief fall earlier in the session.
The price is near to the highs of last Fridays close now,
this action does suggest that wave (c) of [ii] is still underway.
The next most interesting levels above us now lie at 53.17,
which is the 23.6% retracement level.
And then 54.35 which marks the previous wave ‘iv’ high.
I am expecting the correction to hit a high in that region now.

Tomorrow;
Watch for wave (c) to break out above the trend channel line and above 53.00 again.

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S&P 500.

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S&P 500 1hr

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The S&P is down also today in an interesting fashion.
The action off the high at 3385 cash, may have created a small five wave move lower.
If this is wave ‘i’ of (i),
then we must see further declines through the week as the larger wave (i) develops.

The initial support level lies at 3303,
and the more significant support lies at 3214.
As with the short term structure in the DOW,
until we start seeing the price break down through these support levels,
there is no real point in getting to excited.

But at least we have some definite levels to work with.

Tomorrow;
Watch for the recent high to hold at least.
The price needs to turn lower to develop wave (i) down.

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SILVER.

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SILVER 1hr

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Silver is working its way higher today in a reasonably impulsive fashion.
The price has broken out above 17.87 and is approaching 18.34 again at the previous wave (b) high.
This wave (b) high at 18.34 is important now,
because if we see a break out above that level,
it will greatly increase the chances that the corrective phase is over now,
and wave ‘iii’ of (i) is underway.

Tomorrow;
17.45 marks the low of wave ‘ii’ now.
So this level must hold and wave ‘iii’ up should continue out above 18.34.

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U.S 10YR.

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US 10YR 1hr.

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Wave (ii) has created an interesting pattern over the last few sessions.
The price drifted sideways for most of last week,
and the range continued to contract all that time.
this has raised to possibility that wave ‘b’ of (ii) traced out a triangle.
And todays rise was part of wave ‘c’ of (ii).
Wave ‘c’ may not be complete yet but it must complete below 131.89.

Tomorrow;
watch for wave ‘c’ to close out below the recent high.
A push back below 130.81 again will signal wave wave ‘i’ of (iii) has begun.

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