Hi there one and all.
Options expiry happens tomorrow and there is the small matter of 1.8 trillion in option value on the table to be settled tomorrow!
and there is this;
The all time record call option buying binge that has taken place over the last month!
WE might note that the last record high was in February, and we all know how that worked out.
Also, here is living proof that the jobs number we saw last month was a complete farce. An 8 hour wait from the back of the line to speak to a state employee about unemployment insurance in Kentucky.
The state police said it will be an 8 hour wait from the back of the line to speak to a state employee about unemployment. pic.twitter.com/plGONcpS6n
— Daniel Desrochers (@drdesrochers) June 17, 2020
<blockquote class=”twitter-tweet”><p lang=”en” dir=”ltr”>The state police said it will be an 8 hour wait from the back of the line to speak to a state employee about unemployment. <a href=”https://t.co/plGONcpS6n”>pic.twitter.com/plGONcpS6n</a></p>— Daniel Desrochers (@drdesrochers) <a href=”https://twitter.com/drdesrochers/status/1273253863492116483?ref_src=twsrc%5Etfw”>June 17, 2020</a></blockquote> <script async src=”https://platform.twitter.com/widgets.js” charset=”utf-8″></script>
This Depression is only getting started my friends.
Down to business.
EURUSD.
EURUSD 1hr.
EURUSD 4hr.
EURUSD daily.
Another down day for EURUSD and this evening we have crossed below that wave (i) support level.
The only fly in the ointment today is the fact that we have not seen an acceleration lower into wave ‘iii’ of (iii).
That may come of course,
but we will have to see the session high today hold at 1.1262,
and further declines into the lower trend line below 1.1100 again as wave (iii) takes over adn gains strength.
Tomorrow;
Watch for the price to hold below 1.1211 and wave ‘iii’ of (iii) to pick up momentum.
GBPUSD
GBPUSD 1hr.
GBPUSD 4hr.
GBPUSD daily.
Cable has made reasonable progress to the downside today and the action fits well with the wave count at the moment.
The price did accelerate somewhat in wave ‘iii’ of (c).
And we have hit the minimum target for wave (c) by breaking the wave (a) low at 1.2454.
There is more downside yet to come in wave (c) as we do not have a five wave pattern complete just yet.
Tomorrow;
Watch for wave ‘iii’ to push down into the lower trend channel line at 1.2360 or so,
then another correction higher in wave ‘iv’ by tomorrow evening.
USDJPY.
USDJPY 1hr.
USDJPY 1hr.
USDJPY daily.
Despite the failure to rally in wave (c) today the action continues to look corrective to the downside.
The wave count is still valid in wave (b),
and still calls for a pop to the upper trend channel line at about 107.70,
This will complete a three wave correction in wave [ii].
And once that is done,
then I will begin to look lower again into wave [iii] of ‘C’.
Tomorrow;
Watch for wave (c) to push higher again and hit 107.70 as an initial target.
DOW JONES.
DOW 1hr.
DOW 4hr
DOW daily.
The market is very quiet today with volume way down from the last few sessions.
I suspect there is a reluctance to do anything until we get over this next options expiry date on Friday.
It is impossible to know what level the market will chase after the close of contracts,
my gut is to the downside in wave (iii).
But there is a whole 1.8 trillion worth of options to expire on Friday.
I know that a the retail trade has been buying calls hand over fist over the last few weeks,
and I know that they are mostly short dated calls also.
We will see how the balance falls on Friday evening or early Monday.
The sheer value of the options to settle tomorrow is definitely an indication
of just how bullish sentiment has pushed people into speculation in droves.
If nothing else,
it is a contrarian indicator for the market for sure!
As for the wave count,
The price seems to be moving in a channel to the upside off the premarket lows this morning.
This can be viewed as the fisrt move into wave (iii) down.
Tomorrow;
Watch for 26611 to hold at wave (ii).
A break of Mondays lows at 25811 will be a signal that wave (iii) is getting started.
Ideally we shouls begin to accelerate into wave (iii) down.
GOLD
GOLD 1hr.
GOLD 4hr.
GOLD daily.
Gold is still holding within a very tight range today also.
There is a slight upside bias on the short erm chart,
as the impulsive action has been to the upside,
and so far we heve seen corrective action to the downside.
I still favour the idea that we are building a base with a series of higher lows,
and the next move will be to accelerate ainto wave ‘iii’ of (iii) to the upside.
Tomorrow;
We have a solid corrective low created on Tuesday at 1712.
I have now labelled this as wave ‘ii’ of (iii).
Wave (iii) will be confirmed with a break of 1745,
but I and looking at 1733 as a signal that wave ‘iii’ has begun.
CRUDE OIL.
CRUDE OIL 1hr.
CRUDE OIL 4hr.
CRUDE OIL daily.
The price is again pushing the highs at 39.30 this evening.
This action has ruled out last nights immediate fall into wave [i] of ‘3’ down.
The next best fit pattern at the moment is for a larger wave ‘2’ flat to be developing now.
This rally is wave [a] of ‘2’ into the highs now.
We should see a drop back into the 34.00 handle again in wave [b] and then a further test of 29.00 again in wave [c] of ‘2’.
I realise that this is a close call now,
as we are so close to the upper limit at 40.56.
So I may be forced to rethink the whole pattern if that level breaks.
For the moment,
I know we are topping here but the final pattern has not revealed itself yet.
Tomorrow;
Watch for wave [b] to drop in three waves back into initial support over the coming few days.
S&P 500.
S&P 500 1hr
S&P 500 4hr
S&P 500 daily.
The early part of this weeks trade saw a huge rally to counter the sharp decline last week.
Off that high we have see a three wave move lower so far.
I am still reasonably confident that the highs for wave ‘2’ are in now.
The action today is again corrective,
with the possibility that wave (iii) down is on the verge of moving sharply lower.
If the market holds 3131 at todays highs early in tomorrows session,
and we then see a decline below 3074 again at the wave (i) low,
that will signal wave (iii) of [i] has begun.
Once wave (iii) down gets going it should break below the 3000 level again with ease.
From the wide angle perspective,
both the daily and 4hr momentum is pointing firmly lower now.
Tomorrow;
watch for todays high to hold first.
A break of 3131 will put this bearish count on hold for a few days.
SILVER.
SILVER 1hr
SILVER 4hr.
SILVER daily.
Silver came down to meet the 17.32 low again this evening in wave ‘ii’ pink.
Wave ‘ii’ does seem to have a three wave expanded flat correction now in place off the high of wave ‘i’.
17.67 marks the interim high within wave ‘i’.
If the price spikes higher and breaks above that level again tomorrow,
that will signal wave ‘iii’ of (i) has begun.
Wave ‘iii’ up should push back up to 18.18 again.
And the larger wave (i) is expected to break out above the 18.40 area before completing.
We will have to wait for next week for that to happen now.
Tomorrow,
in the short term, wave ‘iii’ up must begin now and break 17.67.