Good evening folks,
here we go again!
EURUSD.
EURUSD is fast approaching the end of this triangle after todays trade.
The price rose in three waves off the 109.65 low created yesterday.
This rise could be a minor wave 'd' within the triangle wave 'b'.
Another drop into the trend line again at 1.0980
would complete an ideal triangle,
and wave 'c' can then rally from there towards the target at 1.1250.
Tomorrow;
price should hold above 1.0965 if this triangle is to remain valid.
Watch for wave 'b' to complete above that level
and then rally again in wave 'c' of (ii).
GBPUSD
Cable has created two lows at 1.2428 over the last two sessions.
Either one of these lows can be viewed as wave 'i' down.
And the rise off that low is labelled wave 'ii' of (i).
The price must now turn lower again into wave 'iii' tomorrow.
A break of that low at 1.2411 again will signal wave 'iii' has begun.
Tomorrow;
Watch for wave 'ii' to complete below 1.2581 and wave 'iii' down to begin.
1.2411 is the level to watch in the short term.
USDJPY.
USDJPY corrected higher into 107.78 today and in a possible wave (b) of [a].
The price then spiked lower again hitting 107.00 in wave (c) of [a].
As it stands ,
wave [a] down is nearing completion.
Wave [b] should begin off a nearby low.
If the price holds above 107.00 tomorrow
that will signal wave (a) of [b] is already underway.
Tomorrow;
Wave [b] should continue higher in three waves over the next few sessions.
If wave [b] breaks to a new high above 108.46,
that will classify the larger wave 'B' as an expanded flat.
Watch for wave (a) of [b] to begin and break 107.78 at a minimum.
DOW JONES.
Just when I was expecting to switch to the alternate bullish count today,
the market goes and declines with a nice impulsive spike lower!
I would like to see more downside in wave 'iii' over the coming few sessions.
But todays decline is a good start.
For the moment the bearish count is safe.
Today decline has brought both momentum indicators negative now after a long divergence.
If the momentum trade turns to the downside now,
then we could pick up steam pretty quickly in wave (i).
Tomorrow;
the key level to watch in the short term is 26400 at the previous wave (a) high.
Watch for wave 'iii' to continue lower tomorrow and draw us closer to a five wave decline.
GOLD
Gold caught a bid off the back of the selloff in stocks,
this is a good sign as we head into a possible rally in wave [v] of '3' over the coming months.
But for now,
todays action raises some questions for wave [iv].
If the triangle pattern is still correct for wave [iv],
then wave (d) must top out now
and then price should drop again towards 1500 in wave (e)
to complete the wave [iv].
I have shown the main alternate count for wave [iv] this evening also.
If the rally off wave (c) develops in a five wave pattern,
then these highs will be viewed as wave (i) of [v] already underway.
In this scenario,
I would like to see wave (i) break 1554 before correcting in wave (ii).
Both wave counts are bullish in the longer term,
but I just have to figure out the kick off point for wave (i) of [v].
Tomorrow;
Watch for wave (d) to top out and wave (e) to fall again towards 1500.
CRUDE OIL.
Crude is falling again today
and we are getting close to filling that gap created last week.
Todays decline s are viewed as wave 'v' of (iii),
where wave (iii) should close the gap at about 55.70.
And then the price should correct higher again in wave (iv) towards the end of the week.
The larger wave [i] down should break 53.00 at a minimum I think.
We may even get towards the previous wave [b] at 50.50.
We will see.
So we should have more downside ahead of us.
Tomorrow;
We are slowly making our way towards a five wave pattern lower off the high.
Watch for wave 'v' to continue lower and break below 56.00 again.
S&P 500.
The S&P got a surprising kick in the rear today
and is falling into the close this evening.
Due to this sudden revival of downside action,
I cant throw away my bearish bias just yet!
So lets work with what we got eh.
The sharp nature of the decline does fit with a third wave.
So this decline should continue tomorrow.
I would like to see a break of that 2940 level before any correction in wave 'iv' begins.
Tomorrow;
The sell off must continue in wave 'iii' of (i) and break support tomorrow.
I we are to stick with the bearish outlook in the short term
then I would like to see a five wave decline by the end of the week.
SILVER.
The alternate count is looking less likely after todays trade.
Silver corrected this morning and the price held above 18.09 as suggested.
This fits the bullish wave count quite well for now,
and the price is again rallying off the session lows this evening.
Today low is viewed as wave 'iv' of (i),
wave 'v' should continue higher tomorrow
and possibly even hit resistance at 19.65 again before the end of the week.
This depends on wave 'v' creating an extension higher.
Tomorrow;
Watch for wave 'v' to rally back above 19.00 again.
Wave (i) should be near to completion at that point.
U.S 10YR.
Bonds got the all too familiar bid off the back of stock market volatility today.
The rally in wave (ii) is now closing in on the 62% retracement level.
So I would like to see this correction finish tomorrow,
and then wave 'i' of (iii) to head lower again by tomorrow evening.
Wave 'i' should break 128.52 again to kick off wave (iii) down.
Tomorrow;
Watch for wave (ii) to top out again and wave (iii) to begin.
A break of the internal wave 'b' level at 129.11 will signal the turn has begun.