[vc_row][vc_column][vc_separator border_width="5"][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]Good evening folks!
Welcome back after the weekend.
Davos got underway today.
This is where the worlds brightest bankers gather every year,
in order to outwit,
outsmart,
outmaneuver
and generally out fox the worlds political class.
By the end of the week the politicians will be sent away on a one way ticket,
straight down into the bowels of hell with great big smiles on their faces.
For which,
they will actually thank the bankers!
It is a complete mismatch of intellect,
Politicians turn up thinking they will impress and charm Jamie Dimon into buying more of their bonds.
While Jamie Dimon knows all too well,
that these guys dont even know what a Bond is.
Never mind the yield curve,
or CDS spread,
tax revenue / interest load.
or effective yield...
It's shooting fist in a barrel!
Speaking of bond yields,
We have not heard mention of the P.I.I.G.S in the bond markets for a while now.
Ireland is one of those pigs,
I just took a look at the 10 year yield,
The first chart shows the yield since 1985.
The yield is now pinned to the floor near all time lows.
Thanks to the German tax payer and the ECB!
While the state actually sits under an odious burden of debt.
Things are looking great eh..
Now look at the last two years action.
The chart is building a series of higher lows.
And the yield has climbed 50 bp in the last three months.
The pattern off the low looks very like an impulse wave to the upside?
This does not look good...
We have reached the time to sell Irish bonds!
the Pigs look like they are about to get fried for dinner![/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]
UPCOMING RISK EVENTS:
USD: WEF Annual Meetings.
EUR: German ZEW Economic Sentiment.
GBP: ublic Sector Net Borrowing.
JPY: BOJ Press Conference.[/vc_column_text][/vc_column][/vc_row]
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EURUSD
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: long term bearish
Wave Structure: Topping in wave [B] black.
Long term wave count: lower in wave [C] black.
After a day absent of all action,
A pattern does seem to be emerging for wave [iv] green.
The market is drifting sideways in a contracting triangle.
Wave (d) is about to finish,
And wave (e) will complete the larger structure.
Once complete,
We can expect a rally into wave [v]
1.2571 is the initial target.
For tomorrow;
Watch for a wave (e) to complete above 1.2213,
A break of 1.2320 will confirm wave [v] has begun.[/vc_column_text][/vc_column][/vc_row]
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GBPUSD
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: short below parity in wave (5).
Wave Structure: continuing impulsive structure to the downside in wave (5)
Long term wave count: decline in wave (5) blue, below parity
Cable is displaying a possible triangle also in wave 'iv' pink.
The price has rallied out of the low of the session to begin wave 'v' pink.
The initial target has been raised to 1.4138,
this level is where wave 'v' pink reaches equality with wave 'i' pink.
This pattern is drawing to a close now,
and it will be time t turn our attention to the downside again soon.
For tomorrow;
The price should continue higher in wave 'v'.
Watch for a reaction off the target or the upper trendline.[/vc_column_text][/vc_column][/vc_row]
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USDJPY
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: LONG
Wave Structure: rally in wave [C]
Long term wave count: wave [C] is underway, upside to above 136.00
USDJPY remains stuck in a corrective limbo after todays trade.
The upside impetus I expect, has not materialized yet.
It is still possible that the price is moving up in wave '3' pink,
if so, it must rally tomorrow to remain bullish in the short term.
On the 4hr chart;
Momentum has turned positive off an extreme low,
also the price is holding above the previous wave (a) green which is a positive sign.
For tomorrow;
We need to see a break of 111.48 to to ignite the bullish short term count.
I am still waiting for a larger impulsive pattern to upside to play out
in order to reveal a possible long term entry point this week.[/vc_column_text][/vc_column][/vc_row]
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DOW JONES INDUSTRIALS
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: market topping process completing
Wave Structure: Impulsive 5 wave structure, topping in an all time high.
Long term wave count: topping in wave (5)
The triangle scenario in wave '4' blue seems to be correct,
after the price rose out of the pattern today.
That pattern in wave '4' has revealed another upper target for wave '5' blue.
If wave '5' reaches equality with with wave '1' on the short term chart,
That projects a new high at 26587.
The price would also meet the upper trend channel line at this point.
For tomorrow;
expect a continuation of the rally into the initial target of 26226 at least.[/vc_column_text][/vc_column][/vc_row]
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GOLD
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: Long to a new all time high above 1827.
Wave Structure: Impulse structure to a new high.
Long term wave count: wave (3) above 1666.
GOLD still hangs in the balance between two competing wave counts.
The compression in price in the GOLD market is also hinting at a possible triangle wave (iv) !
A further contraction in range tomorrow around the 1333 level will confirm this pattern.
wave 'e' should complete above 1328 in this scenario.
A rally into the upper trend channel line would carry the price to 1380 or so in wave (v) blue.
While,
A break below 1324 will rule out the triangle and confirm the alternate count.
For tomorrow;
A break out above the contracting trendlines will signal that wave (v) has begun.[/vc_column_text][/vc_column][/vc_row]
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U.S CRUDE OIL
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[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]My Bias: topping in a large correction wave [4].
Wave Structure: Double combination higher in wave [4] red.
Long term wave count: wave [4] target $63 - $70
Crude spiked and then quickly dumped today,
which has altered the short term count slightly.
I have now shown a possible three wave flat unfolding in wave (c) grey as the most likely pattern.
Wave 'c' pink should now carry the price down to the lower trend channel line at about 62.30.
This will complete the larger double combination wave [iv] brown,
And it should set up the market for a solid rally in wave [v] brown.
Thi initial target at about 67.00 and an upper target on the daily chart at 70.00.
For tomorrow;
watch for decline into the 62.00 region,
Where the price should find a bottom in wave [iv].[/vc_column_text][/vc_column][/vc_row]