As we are about 90 minutes for the US Stock market bell ringing, overnight price movements suggest a gap higher on the opening. Assessing the wave pattern and wave measurements, it appears this opening gap likely will get faded as we retest the lows from yesterday. Prices could drift as high as 1970 and still be within the realm of a normal upward correction...
Today’s rejection at 1.1720 coincided with multiple wave relationships. It is difficult to determine which count is standing out as the confluence includes relationships from the top 2 counts. We’re leaning towards another 1 or 2 series of down-up sequences which suggests slightly higher prices. Therefore, the better risk to reward ratio trade suggests waiting...
2 months ago we identified Gold as a market that “the wave picture on Gold is simple, though the timing of the trade may prove difficult.” From a bigger picture perspective, Gold was close to finding a meaningful bottom. We went on to say “There is a false breakout zone from 1060-1131 which means so long as prices hold above 1060, this wave counts suggests the...
The Loonie has been slopping around sideways for the past couple of weeks. Back on July 22, we wrote about the possibility of a multi-hundred pip sell off. After a brief dip, prices drifted higher from July 29-Aug 4. The Aug 4 peak occurred at a level where a wave relationship suggests the possibility of a deeper sell off (see wave relationships below). The...
This pair appears to be nearing or has already finished a sequence to the upside that may finalize an upward double correction. We'll use the grey trend line break to determine a short term top is in place then consider short trades back down towards .69. So this is a break out trade and risk can be set just above the swing high. Longer term charts (not shown)...
EURUSD continues to carve a sequence of 3 wave moves. The pattern since mid-July shows an equal wave zig zag followed by a flat correction. Nothing earth shattering from a trading perspective as indicators are mixed which supports the idea we are stuck in a correction of which we are currently in the middle. Look for extreme edges of the range to consider...
Yesterday, Banco de Mexico (Mexico's central bank) announced a committment to sell 200 million USD daily, if needed to contain the Peso sell off. Though this trend has been firmly planted to the upside, symptoms of a pause are bubbling up to the surface. The Banco de Mexico news comes at an interesting time. 1) Elliott Wave Count - We could be near the...
Last week, the Kiwi hit the top end of a target range we have been watching. How much, if any move is left? On the heels of the RBNZ 25 basis point rate cut today, some cracks are beginning to show up in the NZDUSD foundation. Governor Wheeler suggests this is it regarding cutting for a while and prices have rallied today. 6680 may provide resistance in the...
2 weeks ago we published an analysis for positioning long the USDCAD. We noted “if we successfully break above 1.28…then I’m eyeing 1.30-1.31”. We can now dial in with more precision where this zone is. There is an elevated probability we’ll see a reaction lower taking place in the 1.3050-1.3150 price range. This doesn’t mean prices WILL trade lower. What it...
Sterling is carving out a sequence of overlapping 3 wave moves which is giving the appearance of a triangle. If that is the case, we are working on the 'D' leg of the triangle. The key element that is tipping me off to a trading opportunity is the 5 wave move higher from July 8-July 15. This is a leading wave and takes the shape of 5 waves. Therefore, there is...
With price meeting Nov 2014 low, technical traders are looking to the current level as a hot spot, where a reaction higher or break lower is likely to occur. The retail sentiment at FXCM is showing 4 times as many traders who are long versus who are currently short. These short traders become a pool of future sellers when they decide to close out their...
Last night, we posted about the potential for a leading diagonal on the EURUSD (see the notes at the bottom of “EUR Analysis Prior to Greece Referendum Vote”). The pair has continued to play that tune which implies: • A tradable low is in place at 1.0915 which coincides with scenario #2 in the “EUR Analysis Prior to Greece Referendum Vote” (see green notes on...
The USDCAD appears to be carving out some impulsive moves higher. This makes sense given that USOil has been slipping lower and appears poised to revisit $45/bl. There is a cluster of wave relationship showing up in the 1.27 handle. If we successfully break above 1.28 (I’m showing a small degree false breakout zone of 1.2800-1.2820), then I’m eyeing...
Many times in the past, I’m asked how/where you begin counting Elliott Waves. There are 3 patterns I look for: 1) 5-3 combo, 2) Equal Wave Patterns, 3) Triangle patterns. This morning, a triangle came to light that unlocked some wave relationships that are causing me to change my tune on Oil. (For those who attended the US Opening Bell webinar this morning, I...
It has been 2 weeks since we posted on the GBPUSD (“Elevated Probability of a 200 Pip Sell Off”). The sell off cut deeper so the higher probability counts are getting shifted around. It appears there are support and wave relationships coming from multiple angles into the 1.5450-1.5550 zone. So the higher probability opportunity is to trade around that...
With the highly anticipated referendum vote coming out of Greece this weekend, emotions will likely be running high on the open of trading Sunday for the EURUSD. With a highly charged event coming soon, I like to take a step back and assess what the waves are suggesting so as not to rely on other’s analysis and their opinions once the news is released. First of...
This drop below 1.1200 on the EURUSD is significant and clears up the wave picture. Also, Sentiment has shifted significantly from last week to today. Sentiment went from 70% short last week after FOMC to now sitting at 60% short. Last Tuesday, June 16, we highlighted 2 higher probability options which called for shorter term bullish moves. (see "EURUSD...
The technical pattern on the EURGBP suggests the EUR may out perform GBP over the coming days. While many traders are fearful of trading EUR due to the Grexit risk, EURGBP may be one vehicle to participate while stripping out USD exposure. From a techincal perspective, the EURGBP has appeared to carve out a 5-3 bullish pattern. This is an Elliott Wave pattern...