Good evening folks.
I hope you had a nice weekend.
And I also hope that all the bugs have been cleared up now.
We will see!
Ok down to business.
EURUSD.
EURUSD hit a slight new low this morning which broke last Tuesdays low at 109.89.
That invalidated the idea that wave 'b' was complete,
but it has not ruled out the idea of a triangle for wave 'b' altogether.
We can still view the range contraction over the last few weeks as a triangle,
with one more higher low left to complete the form.
If the price action holds within the trend lines as shown,
then wave 'b' will complete at about 1.0985 by tomorrow evening.
Tomorrow;
Watch for a tight trading range tomorrow to complete wave 'b'.
The wave 'a' high lies at 1.1084.
If the price rallies above the level it will confirm wave 'c' is underway.
GBPUSD
Cable has dropped again today,
but the price action is nowhere near a five wave pattern lower yet.
It is possible that waves 'i' and 'ii' are complete now,
If that is the case,
wave 'iii' should push lower tomorrow and break 1.2280 at the previous fourth wave.
This level is also the price territory of the wave (a) high.
So a break of this level will add to the idea
that the price is turning lower into wave [iii].
Tomorrow;
Watch for wave 'iii' of (i) to continue lower and break 1.2280.
We should get a clear five waves down in place by the end of this week.
USDJPY.
Wave (a) down seems to be close to completing at this evenings lows.
If the over night trade rises back towards 108.00 again,
that will signal that wave (b) is underway.
Wave (b) should trace out a three wave structure to a lower high below 108.46.
And then wave (c) will fall again towards 106.75.
If all goes according to the model,
then wave [a] down should be in the bag by the end of the week.
But this is a correction,
so I expect the action to get messy!
Tomorrow;
Watch for wave (b) to begin and rise in three waves towards 108.00 again.
DOW JONES.
The DOW was lower at the open today but again the market has recovered some of those losses.
It interesting to note,
that the sharp declines off the July highs
started in the exact same fashion as we see right now.
A stuttering sideways move first,
followed by a free-fall which quickly dropped 2000 points.
So I remain vigilant this time also.
As far as the alternate count goes.
The recent price action can be viewed as fourth wave correction
within wave '5' as shown on the 4hr chart.
If we see a spike higher tomorrow out of todays lows
that action will lean heavily in favor of the alternate count.
Tomorrow;
A further decline tomorrow which carries down towards the 26400 level
will save the bearish count for now,
and it will signal that wave 'iii' of (i) has begun.
And as I mentioned earlier,
if wave [iii] does get going this week,
it could move rapidly.
GOLD
Gold is higher again today,
and the rise off the wave (c) low can be viewed as three waves.
I have labelled todays rally as wave 'c' of (d).
Wave (d) has now reached the 1524 level suggested,
so we are likely to see the price drop again in wave (e) beginning soon.
If the price falls again tomorrow back to the 1500 level in a three wave pattern,
that will complete the triangle in wave [iv].
Then we can look for wave [v] to begin off that wave [iv] low.
Tomorrow;
Watch for wave (d) of [iv] to top out soon.
Wave (e) must hold above 1483 at the wave (c) low.
CRUDE OIL.
Crude is lower today but only just!
the price spiked lower this morning,
and so far we have another rally to a lower high this evening.
So far I am viewing todays action as the beginning of wave 'v' of (iii).
this suggests wave (iii) has further to go before completing.
As I said last week,
I would like to see wave (iii) fill the gap at about 56.00.
Tomorrow;
Watch for price to hold below 59.00 and continue lower into wave 'v' of (iii).
S&P 500.
We are at a decision point now for the stock market.
The S&P did not make a new low today as in the DOW.
This is a little worrying given that it is a non confirmation of sorts.
If wave 'iii' down does not come in strong tomorrow,
I will have to switch to the alternate count for wave '5' as shown on the 4hr chart.
A sharp move lower to break 2940
will be enough to hold the bearish outlook in the short term.
Tomorrow;
Watch for wave 'iii' to push lower directly at the open tomorrow.
If that does not happen,
we will have to prepare for another run higher in wave '5'.
SILVER.
Todays rally in silver is very impulsive looking indeed.
I have labelled this as wave 'iii' of (i),
with the outlook for a larger rally in wave [v] now very much on course.
Wave (i) should continue higher in a five wave move over the next few days.
A break of 19.65 is possible also if wave (i) extends.
I have changed the alternate count to a possible flat correction.
With todays rally labelled as wave (b) of [iv].
If the rally halts and price turns lower again tomorrow to break 18.09,
that will trigger the alternate count.
Tomorrow;
Watch for price to hold above 18.09 and wave (i) to stay in force, possibly to the end of the week.
U.S 10YR.
Bonds have now completed a possible three wave correction higher in wave (ii) at todays highs.
The rally in wave 'c' of (ii) reached the 50% retracement level at the high,
this level also corresponds with the previous fourth wave high from 2 weeks back.
The price has now fallen again this evening after reaching the target,
so all the signs are pointing to a completed bearish impulse wave lower in waves (i) and (ii).
Wave (iii) down will be confirmed with a break of 128.52.
Tomorrow;
Wave 'i' of (iii) should begin now.
Watch for a five wave move lower off todays highs.