This analysis has been further updated on Oct 9, 2017.
Hi Traders,
Dark storm clouds are gathering over the Hang Seng Index (now at 28,324) which just completed the whole set of Elliott Waves up. The HSI could start soon a sharp correction. First target around 26,000.
ELLIOTT WAVES
The monthly chart shows that the HSI started a huge wave 4 at the end of Sept 2004. This wave is usually made of 3 legs (a-b-c). The first two (wave a and wave b) are now fully deployed. Wave c downwards is on the making right now. Unfortunately, it can be a catastrophic correction.
Note the possible incoming targets around 26,000.
The weekly chart shows the double top that confirms an imminent reversal. Usually, the incoming wave c is a sharp downtrend made out of 5 waves.
The daily chart reveals 9 waves up which are equivalent to a regular set of 5 waves up. Ralph Elliott used to label 9 waves wherever the correct labeling was too hard.
The 4-hour and the 1-hour charts show two exhaustion gaps and the start of the new downtrend.
Monthly chart, click to enlarge
Weekly chart, click to enlarge
Daily chart, click to enlarge
4-hour chart, click to enlarge
1-hour chart, click to enlarge
Hi Traders,
The SPI 200 (now at 5660) seems to be close to the end of the line and the rats are leaving the sinking boat.
Although a small rebound to 5700-5730 is still possible, the SPI 200 is singing the swan song which could be followed by a deep dive to the major support at 5320-28.
ELLIOTT WAVES
The daily and 4-hour charts show a huge round formation started on May 1st, 2017. This pattern is usually quite time-symmetrical.
Given that the centre of the round formation is the lowest low at 5592, we have 36 days from the centre to the high on the left, and 37 days from the centre to the high on the right. See the vertical lines. After the same number of days have passed, a new trend should start.
On a much bigger scale, the monthly chart reveals that the SPI 200 performed a huge a-b-c retracement from the low in March 2000.
The weekly chart also shows an a-b-c retracement up. It reveals that the present downtrend actually started around mid-March, 2015 at 6010.
In fact, the low at 4643 on Feb 2016 was followed by a retracement rally to 5944 on April 30, 2017.
The latter was the very last top of the SPI 200 and it marked the completion of retracement wave 2. Note that the gap between 6020 and 6102 has never been filled.
Finally, the faith of the SPI 200 is quite correlated to a possible downtrend of the AUDUSD. The drop of the ASX might be significantly mitigated if Australian Dollar is driven below the 0.70 level by the action of the markets or by the Central Banks (FED or RBA). Conversely, the SPI 200 would sink vertically.
Monthly chart, click to enlarge
Weekly chart, click to enlarge
Daily chart, click to enlarge
4-hour chart, click to enlarge
Hi Traders,
Gold (now at 1333) topped at 1336.82 and missed my target at 1337.3 by a whisker. After a limited retracement - theoretically, to 1322 or 1312 - it should resume the uptrend to 1532 or 1628.
ELLIOTT WAVES
The monthly chart
suggests that Gold is performing an a-b-c to 1532. The weekly chart display a set of possible targets:
- 1337
- 1433
- 1532 (my favourite)
- 1628.
The 4-hour chart
shows that Gold just started a wave extension.
The 1-hour chart displays the targets at 1322 and 1312.
Monthly Chart, click to enlarge
Weekly Chart, click to enlarge
Daily Chart, click to enlarge
4-hour Chart, click to enlarge
1-hour Chart, click to enlarge
Hi Traders,
We might have some interesting weeks ahead as the WTI OIL (now at 45.75) is approaching the targets.
The OIL is only inches from completing the whole set of waves down, being the theoretical target at 45.59-45.34. If this analysis is correct, we could witness the start of a new rally that could take it to 61.50 (see the weekly chart).
ELLIOTT WAVES
The weekly chart displays the blue horizontal lines as possible targets. The daily chart shows the likely completion of wave 4 by hitting the target at 45.59-45.34. The 4-hour chart shows the recent low at 45.60 and the a-b-c that shaped wave 4.
NOTE: There might be another small ripple down - which will be visible on the 1-hour chart - before the start of the rally.
Weekly chart. Click to enlarge
Daily chart. Click to enlarge
4-hour chart. Click to enlarge
1-hour chart. Click to enlarge
Hi Traders,
WTI OIL (now at 48.65) is sitting on an important support/resistance. After a small drop to $48, it should move to a much higher ground. It could hit $61 soon and maybe $66-$68. Gann analysis suggests a final target of $75.
ELLIOTT WAVES
The weekly chart shows OIL is staging 3 major waves up. Wave 2 is complete and wave 3 just started.
The daily and 4-hour charts reveal that we just started minor wave 5, maybe to 51.65. The 1-hour chart shows the completion of wave 4 and the start of wave 5.
Weekly chart. Click to enlarge
Daily chart. Click to enlarge
4-hour chart. Click to enlarge
1-hour chart. Click to enlarge
