EURUSD, Head & Shoulder

Hi Traders,

The Head & Shoulder is a reliable reversal pattern. If you master the Elliott Waves you can identify the right entry points and targets to enhance the profitability of your trading in such a market condition.

SITUATION

With the violation of this major support at 1.2886 the EURUSD - which now staged a H&S in the daily chart - will start the last major wave downward which might bring it to 1.19 and, under extreme conditions, to 1.12, target that I wouldn't dismiss at all.

If this analysis is correct, the resistance around the area 1.2899-1.2911 (or  maybe 1.2928-1.2935) should be a viable entry point for a juicy short, lasting weeks.  

TARGETS 

daily chart
DOWN

likely: area 1.2752-1.2744
possible:  the area 1.2658-1.2688

weekly chart
DOWN

likely: the area 1.2457-1.2520
possible: 1.2328

Note the cycles in the weekly chart below. Also, check the targets (blue horizontal lines).


weekly chart - click to enlarge

See the Head & Shoulder in the daily chart below

daily chart - click to enlarge

4-hour chart - click to enlarge

1-hour chart - click to enlarge

SPI200, a necessary ZigZag

Hi Traders

The SPI200 now at 4,985 took a big hit in the last few weeks. Although this happens all the time around the end of May, many ask whether this is the end of the uptrend.

THE REAL PICTURE

Check the weekly chart below. After the big slump occurred in Nov 07-Mar 09, the SPI200 performed major-wave-1 up and major-wave-2 downward (in bold grey, font 15). It's now trying to unfold major-wave-3 to the area 5,469-5,572.

But hold your horses.

weekly chart - click to enlarge

To be able to develop major-wave-3 the index needs a system of 5 waves, 3 of which are already on the paper (1-2-3 in blue). 

Now, every Elliott guy knows that the next wave (wave 4) could be a boring long term ZigZag (or 5-3-5) between the previous major top and the area at 4,569-4,459. 

This Zig-Zag will be followed by the resume of the last wave up (wave 5).

All the blue horizontal lines in the weekly chart above are possible targets for wave 4, a zig-zag made of 3 to 5 waves. 

TIMING

Wave 4 in the weekly chart above might end around September 13-16 followed by the start of the final uptrend (wave 5).


SHORT TERM SITUATION

In the daily chart below, this very first downtrend must be completed in 5 waves. We just started the small retracement-wave-4 to 5,004-5,009 an maybe higher (5,033-5,036).

Then wave 5 will resume downward to 4,888 and maybe 4,849.

Note: the target area marked by the blue horizontal lines. This is the target of the first impulse wave downward.



daily chart - click to enlarge

TARGETS

short pullback (wave 4 in the 4-hour chart) to

likely: area 5,004-5,009
possible: 5,033-5,036

then

short downtrend (wave 5 in the 4-hour chart) to 

likely: 4,907-4903
possible: 4,888-4,849

Target area even clearer (the targets) in the 4-hour chart below


4-hour chart - click to enlarge

GOLD, hold your horses

Hi Traders,

I heard everything and the opposite of everything about Gold. Let's out some of the nonsense.

• Is this downtrend over? Almost done, be patient.
• Will it be followed by a rally? There's now the chance of a rally.
• Is Gold going to start a major uptrend? Much depends of the ability of the commodity to break the area of resistance at 1,522-1,532.
• Most importantly, it depends by the number, shape, and magnitude of the developing Elliott Waves.

TARGETS

VERY SHORT TERM UPTREND (1-hour chart)

area 1,414.6-1,419.0 and

area 1,438.9-1,442.9

SHORT TERM DOWNTREND (4-hour chart)

area 1,335.7-1,308.6

MEDIUM TERM UPTREND  (daily chart)
area at 1,522-1,532.

SITUATION

GOLD, now at 1,492.27, is performing a minor rally to the areas 1,414.6-1,419.0 and, most likely, 1,438.9-1,442.9. This will be followed by a downtrend to the area 1,335.7-1,308.6. 

If this target is reached by means of 5 waves downwards - verifiable in either  the 4-hour and the 1-hour chart - there could be a new rally to the area at 1,522-1,532.

ENTRY FOR A POSSIBLE LONG

After getting to the area 1,335.7-1,308.6 in 5 waves - in the 4-hour or 1-hour chart - you need to make sure that Gold is bottoming out. Consequently:

• make sure that you have the right "set of waves"  in the 4-hour and 1-hour chart.
• check that you have a reliable reversal candlestick in the 4-hour and 1-hour chart.
• check that you have a confirmation from the wave oscillator.

ALL CHARTS BELOW

Gold weekly chart - click to enlarge

Gold daily chart - click to enlarge

Gold 4-hour chart - click to enlarge

Gold 1-hour chart - click to enlarge