Tuesday, 20 February 2018

The Australian Dollar next move

Hi Traders,

Although another small rally to 0.795 is still possible, the AUDUSD (now at 0.7920) should resume the major downtrend to 0.75 soon.

THE ELLIOTT WAVES

The monthly chart reveals that the Aussie is unfolding a huge a-b-c retracement wave (since July 2011) where the last leg (wave-c) is supposed to be made out of 5 large waves down. 

Four of these five waves can be observed in their entirety on the monthly and weekly charts. With the top on Jan 26, their deployment is now complete.

This means that the formation of the fifth wave down begun on Jan 26, as you can see in the daily and 4-hours charts.

Besides, the weekly and daily charts display clearly the large a-b-c that formed wave-4, which in turn, is one of the large five waves above mentioned.

CONCLUSION:

For the time being, this new phase should take the Aussie down to the 0.75  area. Subsequently, unless a "surprise extension" to 0.85 occurs, the Australian Dollar should take a dive well below 0.75.




Monthly chart, click to enlarge







Weekly chart, click to enlarge







Daily chart, click to enlarge







4-hours chart, click to enlarge







1-hour chart, click to enlarge







Monday, 19 February 2018

The Euro topping

Hi Traders,

The EURUSD (now at 1.2412) apparently topped at 1.2555, although I thought  it would have ended its run a bit higher. It's now supposed get back to 1.244-1.246 and then resume the downturn to the 1.20-1.18 area and below.


THE ELLIOTT WAVES

The monthly chart reveals that the Euro is unfolding a huge a-b-c retracement wave (since July 2008) where the last leg (wave-c) is supposed to be made out of 5 large waves down. 

Four of these five waves can be observed in their entirety on the monthly and weekly charts. Their deployment is complete.

Conversely, the formation of the fifth wave down has just begun, as you can see in the daily and 4-hours charts.

Besides, the weekly and daily charts display clearly the large a-b-c that formed wave-4, which in turn, is one of the large five waves above mentioned.

CONCLUSION:

For the time being, this new phase should take the Euro down to the 1.20-1.18 area. Subsequently, unless a "surprise extension" to 1.30 occurs, the Euro should take a dive well below 1.18.



Monthly chart, click to enlarge








Weekly chart, click to enlarge








Daily chart, click to enlarge








4-hours chart, click to enlarge








1-hour chart, click to enlarge








Sunday, 18 February 2018

The Pound Debacle

Hi Traders,

The Pound (now at 1.4025) dived as predicted in my previous newsletter. Unless a surprises rally to 1.45 occurs, it is now supposed to bounce back to 1.41 before resuming the major downtrend.


ELLIOTT WAVES


The monthly chart reveals that the Cable is performing a huge a-b-c where  wave-c is made of 5 waves down. Four of these waves are already fully deployed. The making of the fifth wave has just started.

The weekly chart displays the end of major-wave-4 but it also shows that the theoretical target is 1.45. This is one of the two reasons why I said that a last minute "surprise rally" is still possible. The second reason is that the wave count actually allows it.

The daily and the 4-hours charts display four small waves down from the top at 1.4350.

The 4-hours and the 1-hour charts suggest a limited rebound to 1.407-1.410 before resuming the downtrend.





Monthly chart, click to enlarge








Weekly chart, click to enlarge







Daily chart, click to enlarge







4-hours chart, click to enlarge






1-hour chart, click to enlarge








Thursday, 1 February 2018

The massive depreciation of the USD vs YUAN

Hi Traders,

The us dollar vs Chinese Yuan (now at 6.298) is bottoming down, maybe around 6.27 or earlier. A retracement to 6.44 might start soon.


ELLIOTT WAVES


The weekly and the daily charts show the impressive depreciation of the US dollar since January 2017, just about when the new US president took his office. 


Considering 100% the range between the highest high and the lowest low of the USD vs YUAN  (6.9874 - 6.0153), the USD dropped a wopping 72% in 12 months.


Between 1.29 and 1.25 (see the target at 1.27 on the weekly chart), the USD might unfold a retracement wave to 6.44
 as displayed in the daily chart.




Weekly chart, click to enlarge







Daily chart, click to enlarge







4-hours chart, click to enlarge







Wednesday, 31 January 2018

The Pound: a dead duck in the water?

Hi Traders,

Although I originally expected the Pound (now at 1.42) to top around 1.45, it  might not be able to make it. 

Even if the GBPUSD attempts another rally to 1.45, it should be the last one and the start of a major downtrend might be in sight.

Consequently, the top we have seen at 1.4345 might be the very end of the rally started on Oct 2016 at 1.1825.


ELLIOTT WAVES

The monthly and the weekly charts display the end of major wave 4. They also show the theoretical target at 1.45.

The daily and 4-hours charts display the last wave count.



Monthly chart, click to enlarge







Weekly chart, click to enlarge







Daily chart, click to enlarge







$-hours chart, click to enlarge







Wednesday, 17 January 2018

The Euro taking a break

Hi Traders,

The EURUSD (now at 1.226) might be staging a temporary top followed by a  retracement to the 1.19 area where it should resume the rally to 1.26 or higher. 



ELLIOTT WAVES

The monthly chart reveals that the Euro is unfolding "major wave 4" to 1.26 and maybe even to 1.30. Note the theoretical final target at 1.3016

The weekly chart shows that "major wave 4" is supposed to be made of three waves up (in black).

The daily chart reveals that the target of the ongoing retracement down is the area 1.202-1.186. As you can see, the Euro is performing a retracement by means of minor wave 4.

This is also clear in the 4-hours chart and in the 1-hour chart which both show five waves up and the beginning of the retracement.



Monthly chart: click the chart to enlarge










Weekly chart: click the chart to enlarge










Daily chart: click the chart to enlarge










4-hours chart: click the chart to enlarge










1-hour chart: click the chart to enlarge










Monday, 15 January 2018

The Aussie Dilemma

Hi Traders,

The Aussie (now at 0.7956) might top in the area 0.7940-0.7996. This top should trigger a retracement to 0.78-0.77.  BTW, what is expected afterward might be debatable. Let's see why.

ELLIOTT WAVES

On the right-hand side of the monthly and weekly charts there is an a-b-c-d followed by 4 waves in green. Apparently, the AUDUSD is trying to unfold wave 5 (in green) which would complete the a-b-c-d-e as well as wave 4 (in red).

This means that, after the retracement above mentioned, the Aussie could actually resume the uptrend to 0.85-0.86 or even to the 0.92-0.95 area.

The daily chart displays the four legs (in blue) and the target at 0.7940-0.7996. It also shows that wave 4 is made of 7 smaller waves, which is equivalent to a 3 waves system. This confirms that this is a typical wave 4.

Consequently, after the top at 0.7940-0.7996 and the subsequent retracement to 0.78-0.77, there could be a rally to 0.85-0.86 or even to the 0.92-0.95 area.


Monthly chart, click to enlarge






Weekly chart, click to enlarge




Daily chart, click to enlarge






4-hours chart, click to enlarge






Friday, 1 December 2017

GOLD PERSISTENT WEAKNESS

Hi Traders,

I think that everybody got the message. A at this point, the combination of crypto-currencies and low inflation is probably the worst enemies for GOLD (now at 1275).


Hence, it's probably a good time for some trades to the South side as Gold might target the 1200 level in the short term (see the monthly chart).

Furthermore, the XAUUSD might not be able to find a serious support before hitting the area 1155-1130 (see the weekly chart).

ELLIOTT WAVES


I must admit that the identification of the Elliott Waves posed some challenges. 
Initially, the monthly chart displayed essentially the following waves:

  • five impulse waves up from Sept 3,1999 (at $253) to Sept 5, 2011 (at 1920) Timing: 144 weeks. 
  • three retracement waves down  (a-b-c) from Sept 6, 2011 (at $1920) to Dec 15, 2016 (at $1046). Timing: 64 weeks, so far.
That looked very much as a case study and I honestly thought that, at 1046,  the downtrend was over.

Instead, I overlooked  an important detail: the candlestick pattern at 1046 (see the low at 55C) was a clear warning that the incoming uptrend was going to be only temporary.

Conclusion: even if a rebound to 1281-90 is still possible, Gold should resume the downtrend to the 1200 area.




Monthly chart, click to enlarge






Weekly chart, click to enlarge






Daily chart, click to enlarge






4-hours chart, click to enlarge




Wednesday, 29 November 2017

The Euro next move

Hi Traders,

After a small rebound to 1.18-1.19, the EURUSD (now at 1.1852) should resume the downtrend. First intermediate target: the area 1.174-1.172

ELLIOTT WAVES

The monthly chart and the weekly chart reveal that the Euro might have  entered a pattern that could last years in the making. If this is the case, the present wave configuration is the typical wave 4 of a downtrend which is made of:
  • three-five waves up to 1.21 (wave a),
  • three waves down to 1.08 (wave b), 
  • followed by five waves up to 1.30 or so (wave c). 
At present, the Euro seems to be running wave b down to 1.08.

The daily chart and the 4-hours chart show a small downtrend made of five waves, four of which are fully deployed already. The fifth wave down just started unfolding.

NOTE the target at 1.174-1.172 in the 4-hours chart and the target at 1.136-1.124 in the daily chart.



Monthly chart. Click to enlarge






Weekly chart. Click to enlarge






Daily chart. Click to enlarge






4-hours chart. Click to enlarge






WTI OIL CLOSE TO A TOP?

Hi Traders,

The WTI OIL (now at 56.70) might stage a temporary retracement to the 56.3 area before the final rally to 61.3-61.8. However, the theoretical target at 66-69.15 cannot be discarded at this stage.

ELLIOTT WAVES

The monthly chart reveals that retracement wave 4 (in magenta) has already retraced 38.2% of wave 3. Within one-two months, it could top around the 61.3-61.8 area, although we shouldn't discard the higher cluster of blue lines at 66-69.15 (50% retracement).

The weekly chart doesn't add much information to the picture but the daily chart and the 4-hours chart draw out attention to the fact that, after point b, the OIL has fully deployed four waves up, plus a number of "extensions" of the "still unfolding" wave 5.

At present, this "extension pattern" suggests that OIL might bottom around 56.3 and launch the very last assault to the target at 61.3-61.8. However, if further extensions occur, OIL might reach the theoretical target at 66-69.15 in a much longer time.

Finally, the 1-hour chart displays the incoming target of this retracement wave at 56.31 (blue horizontal line)

NOTE the vertical lines on the weekly chart. WTI OIL took 99 weeks to develop wave 2 (in magenta). In case wave 4 takes the same amount of time, it would top around Dec 22. 




Monthly chart. Click to enlarge








Weekly chart. Click to enlarge








Daily chart. Click to enlarge








4-hours chart. Click to enlarge








1-hour chart. Click to enlarge