Dow Jones looking really scary

Hi Traders,

The Dow Jones (now at 25375) seems to defy the good fundamentals of the US economy. In fact, it is now staging a correction heading to the area 25000-24700

ELLIOTT WAVES

As you can see in the weekly  chart, the DJ30 is unfolding a typical wave four, which is made of an a-b-c pattern. Wave a (down) and wave b (up) are completed and wave c (down) just started its way down.This is even clearer in the daily chart.

Finally, the 4-hours chart reveals the completion of wave b and the start of the new downtrend with the first two waves: wave 1 and wave 2. NOTE: the strong reversal candlestick pattern made of the last three candles.





Weekly chart, click to enlarge

Daily chart, click to enlarge

4-hours chart, click to enlarge

FT100 & SPI200 to turn South?

Hi Traders,

Both the British FT 100 index (now at 7620) and the Australian SPI 200 index futures (now at 6230) might be aiming for a correction.


ELLIOTT WAVES

The fundamentals for this turnaround seem to be exclusively political for both countries but, on the technical side, the two indices might head to a similar destiny despite a different wave count.

FT 100 index

The daily and 4-hours charts show the completion of wave four. A drop to the 7280 area might follow soon to make room for wave five.

The weekly and monthly charts display the completion of five waves up, signalling a top and the end of a major wave count. A correction should follow. 

Finally, the weekly  chart reveals 4-5 doji candles. This is called "breakaway pattern". It's a continuation pattern aiming to continue the downtrend initiated after the top at 7884.6   

SPI 200 index futures

The SPI 200 (now at 6230) could still end its course around 6330 - see the top blue line in the monthly chart. In meantime, a correction might be under way. 

The daily and 4-hours charts show the completion of five waves as well as a dangerous double top. A drop to the 6098 or 6076 area might occur.

The monthly and the weekly chart shows that the huge a-b-c might not be completed yet and this correction might be only temporary. 


FT 100 CHARTS


FT 100 - Monthly chart, click to enlarge

FT 100 - Weekly chart, click to enlarge

FT 100 - Daily chart, click to enlarge

FT 100 - 4-hours chart, click to enlarge

SPI 200 CHARTS




SPI 200 - Monthly chart, click to enlarge

SPI 200 - Weekly chart, click to enlarge

SPI 200 - Daily chart, click to enlarge

SPI 200 - 4-hours chart, click to enlarge

THE OIL TO TURN SOUTH AGAIN?

Hi traders,

The WTI OIL (now at 66.63) is approaching the theoretical Turning Point at 67.20-67.42 where it should resume the downtrend to the area at 62.74-62.35.


ELLIOTT WAVES

The monthly chart shows that we might have witnessed the last retracement wave up (at 5 4 ) before the final dive which will deploy wave-5 downwards (not labelled yet).

The weekly chart shows the giant a-b-c started in Feb 2016 where wave-c is still in the making. Wave-a and wave-b are fully deployed whilst wave-c still needs another small leg down (wave-5, still to be labelled) to complete the giant a-b-c.

As for the daily chart and the 4-hours chart, see wave-4 approaching the theoretical Turning Point at 67.20-67.42.




Monthly chart. Click to enlarge

Weekly chart. Click to enlarge

Daily chart. Click to enlarge

4-hours chart. Click to enlarge

Time to Short the USDSGD?

Hi Traders,

The USDSGD (now at 1.3361) seems to be ready for a big dive as it shows clear signs of extreme weakness. It might be heading to the 1.3147 area sooner than later.

See the blue target lines in the monthly chart and in the weekly chart. 

ELLIOTT WAVES

The monthly chart shows the completion of major wave 4 around January 3, 2017. That Pivot Point marked the start of major wave 5 downwards (not labelled yet).

The weekly chart and the daily chart show the completion of another wave 4 of a lesser degree around May 10.

That Pivot Point marked the start of another wave 5 of a lesser degree downwards (not labelled yet).

Finally, the 4-hours chart shows a significant double top. Note the last 4 bars: it's a candlestick pattern called runaway pattern. This could be a nearly perfect time to short the USDSGD.




Monthly chart, click to enlarge

Weekly chart, click to enlarge

Daily chart, click to enlarge

4-hours chart, click to enlarge

Time to short the Aussie?

Hi Traders,

The AUDUSD (now at 0.7615) is mocking up the Titanic as it seems to be ready to sink. Although there is still a chance for a small rally to the area  0.7638-42, it shows clear signs of extreme weakness and it might be heading to the 0.73 area sooner than later.

See the blue target lines in the weekly chart.

ELLIOTT WAVES

The monthly chart and the weekly chart show the completion of major wave 4 (in magenta) around Jan 26. That Pivot Point marked the start of major wave 5 downwards (not labelled yet).

The daily chart displays another wave 4 that topped around June 6. That Pivot Point marked the start of another wave 5 of a smaller degree, heading South as well (still, not labelled yet). Note the major support at 0.7500.

The 4-hours chart shows the composition of wave 4 and the short term target of the first leg of wave 5 (not labelled yet) aiming to 0.7560




Monthly chart, click to enlarge

Weekly chart, click to enlarge

Daily chart, click to enlarge

4-hours chart, click to enlarge

WTI OIL to top soon?

Hi traders,

The WTI OIL (now at 71.75) is loosing steam and might top soon. Although my target is still the area 74.91-77.13, it might actually top before 74.00

ELLIOTT WAVES

The weekly chart shows the giant a-b-c started in Feb 2016 where wave-c is almost completed. Wave-a and wave-b are fully deployed whilst wave-c is in the very final stage.

The monthly chart shows that this giant a-b-c is just a retracement wave up (wave four) of the downturn that started in July 2008. Once completed, it will stage an important correction to the South side.

As for the daily chart, it displays a 1-2-3-4 (in black). After that  another 1-2-3-4 (in green) highlights four waves of a smaller degree. Once wave five is completed, the whole pattern could reverse course.

Finally, check the arrow in the 4-hours chart: it highlights a candlestick pattern that usually occurs when a top is imminent.



Monthly chart. Click to enlarge

Weekly chart. Click to enlarge

Daily chart. Click to enlarge

4-hours chart. Click to enlarge

WTI OIL STILL HEADING SOUTH

Hi traders,

I am grinning as I got it right again. At present, the WTI OIL (now at 63.35) seems to be heading towards the 57.30 area as it's performing a retracement wave  (see my previous post). However, there is still a chance for a small jump to the area 64.15-64.64 before heading South.

ELLIOTT WAVES

The weekly chart shows the giant a-b-c started in Feb 2016 where wave-c is in the making. Wave-a and wave-b are fully deployed whilst wave-c is still in the making. It could end in the 69.6-70.50 area or even the 74-77 area.

The monthly chart shows that this should be the last retracement wave (up) before the final dive (wave-5).

As for the daily chart, another smaller wave-4 is unfolding with an a-b-c on a much smaller scale. Wave-a and wave-b are already in place whilst wave-c is still in the making with a possible target down to 57.30.

The 4-hours chart shows the target area of the possible rebound: 64.15-64.64 within the next few hours, whilst the 1-hour chart draws our attention to a possible intermediate target at 61.30-61.45.





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

Time to short the Euro?

Hi Traders,

As I said in my previous newsletter, the Euro bounced back a bit and then resumed the downtrend, probably 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:

Given the particular pattern, the Euro might take a sharp dive well below 1.20-1.18.







Monthly chart, click to enlarge

Weekly chart, click to enlarge

Daily chart, click to enlarge

4-hours chart, click to enlarge

Gold doomed to fail?

Hi Traders,

Even the stones on the ground noticed that GOLD  (now at 1313) is inversely correlated to Bitcoin. When Gold topped at 1366 at the end of January,  Bitcoin bottomed at 6,981 at the very beginning of February.

Now that Bitcoin is moving up again (now at 10,427), Gold shows extreme weakness and it started a journey that should take it to 1301 and to the area 1251-1234 for a start.

CONCLUSION:

Although the XAUUSD is supposed to bounce back to 1330, overall it looks extremely bearish - see the daily chart - and might not be able to find a serious support before hitting 1239 or even the area 1178-1143 (see the weekly chart).


ELLIOTT WAVES

The identification of the Elliott Waves often poses some real challenges when it comes to some complex waves labelled by the purists "wyz-x-wyz".

For the time being, I prefer to avoid that fancy stuff and stick to the hypothesis of a wedge formation - see the weekly chart - that might require another low around 1200.

However, just bear in mind that, in the very long run, this kind of pattern has the potential to drag the yellow metal down to the area 882-845. See the targets in the monthly chart.

Want to see some fancy stuff? Check the supports on the 4-hours chart. Basically, there's a support every $11

Monthly chart, click to enlarge

Weekly chart, click to enlarge

Daily chart, click to enlarge

4-hours chart, click to enlarge

WTI OIL to top soon?

Hi Traders,

The WTI OIL (now at $63.40) might top around 64.75-65.05 and temporarily reverse to the 57-55 area.



ELLIOTT WAVES

On the monthly chart, check the last red candlestick: it looks like an inverted hammer. This typical candle appears during the making of wave-4, which is the last retracement wave before the final rally (wave-5).

The weekly chart shows the giant a-b-c started in Feb 2016. It could end in the 69.6-70.50 area or even the 74-77 area.

As in the daily chart, another smaller wave-four is unfolding with an a-b-c where wave-a is already in place and wave-b is topping soon. This demonstrates that this is only a temporary retracement.

The 4-hours chart and the 1-hour chart draw our attention to the incoming target at 64.75-65.05.





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