In our previous article, we talked about the Bullish Palladium XPDUSD which is supporting the commodity market for another leg to the upside. To be able to join for the move higher, we need to identify the potential scenarios and look for the next inflection areas using our Elliott Wave Theory charts.
XPDUSD Elliott Wave View
The move from January 2016 low is advancing in a series of 5 waves forming higher highs & higher lows and has a high probability of completing an impulse move as it keeps extending higher. So technically the metal should trade within the bullish channel and see higher levels around $970 – $1080.
On Friday June 9, XPDUSD reached equal legs area $900 from January 2016 low and already reacted lower from there ending the cycle from 05/22 low. The metal did 3 waves from the peak which could be enough to resume higher , but if we correlate the move with the rest of commodities then while it’s holding below the peak it can still make another leg lower toward the 50% – 76.4% area $830 – $787 before another bounce higher is seen as long as pivot at 752 low keeps holding.
If XPDUSD mange to break below $752, then most likely it will end the cycle from January 2016 low as a double three structure and will do a deeper correction that can reach the 50% retracement around $680 before it resumes the move to the upside.
Recap
Palladium is currently the strongest performing metal and having a monthly bullish sequence is clearly sending a warning message for commodity bears So it’s not a wise choice to look for the short side at current stage and it’s better to trade the clearest structure among the the strongest instruments.
Short term DAX Elliott Wave view suggests the rally from 5/18 is unfolding as a double three Elliott Wave structure. Minute wave ((w)) ended at 12879.5 and Minute wave ((x)) pullback ended at 12617. Internal of Minute wave ((x)) subdivided as an expanded flat Elliott Wave structure where Minutte wave (a) ended at 12633.5, Minutte wave (b) ended at 12922.5 and Minutte wave (c) of ((x)) ended at 12617. DAX has broken above Minutte wave (b) on 6/14, adding conviction that the next leg higher has started. Up from 12617, the rally is unfolding as a zigzag Elliott Wave structure where Minutte wave (a) ended at 12948.5 and Minutte wave (b) is proposed complete at 12772.5. Near term, while pullbacks stay above 12772.5, and more importantly above 12617, expect Index to extend higher. We do not like selling the proposed pullback.
We track a lot of Indices around the World. One of the Indices we track is DJUSRE (Dow Jones US Real Estate Index) which provides a guideline for housing properties in the U.S. Buying real estate is always a good way to invest and make money. For years, investors use the real estate sector as one avenue of investment. There is an aspect which many people miss which is the timing. During the 2002-2006 period, prices of properties skyrocketed around the world and many people were able to make a quick profit and cash thousands of dollars out of the investment.
However, there were also many people who got trapped at the top and defaulted on the home loan because of the rapid decline in value and the obligation to the bank. When it comes to real estate, timing is everything and the method of buying also plays a role. There are two ways to buy properties, either using cash or bank’s mortgage. The difference between the two is the interest on the loan, either with a higher monthly payment or with an early penalty that can cost thousands of dollars.
The worst case scenario for an investor is buying at the peak using bank’s loan. During the 2008 – 2009 credit crisis, a lot of home owners owe the bank more than the value of their homes as prices collapse driven by speculative buildup of houses and subprime mortgage. If we drove around in 2010, we were able to see a lot of empty houses and buildings. Most of the buildings belong either to banks or associations.
DJUSRE (Dow Jones US Real Estate) Long Term Chart
Looking at DJUSRE chart above, current real estate price is around the price in 2004-2005. When buying real estate you can do it for a flip or a long term investment. For a flip means that the investor will bet in a fast increase in value and then sell the property for a quick cash. Timing will play a big role when buying for a quick gain as it needs to be done at the proper time. Improper timing can leave investors with a bad investment or like many like to call under the water.
Listening and looking around we can see an increase in TV advertisement on real estate promoting real estate company and sites. These are warning that the crowd has started again to buy properties. Even when the housing boom can last for another couple of years, we can be entering soon into areas when a biggest correction can happen. The increase in advertisement as well as the signs on the streets which is a reflection of the crowd environment is calling for the top to be forming soon.
When looking at DJUSRE Index chart above, if it manages to break above 2007 peak, it’s possible to reach 454 level. This level is when the rally since all-time lows to 2007 will equal to the rally from 2009. When looking at other indices around the world, we believe this could be the scenario in real estate market. When DJUSRE Index breaks above 2007 level, it will drive properties even to new all-time highs, but investors need to know that if they want to buy home now, it is for a quick gain (flip) and not for long Investment.
We need to understand the differences between the two and invest accordingly, otherwise we can get caught in the wrong side. The real estate correction which should happen around the year of 2020 should be bigger than the correction in 2008 and consequently the damage can be even worse. We recommend investors who want long term investment to wait. Regular buyers need to understand that property will revisit these 2009-2010 levels again sometimes in the future so do get any cash out of the property so not to be under the water.
The path we expect for Dow Jones US Real Estate Index is a path to 367 then a turn lower to 320 before last push higher to 454. The Index should then see a huge correction and prices could drop to the levels of 2010 again around 160 when huge buying chances will happen. In reality, Market has two sides and many people who bought in 2009-2010 lows as investment will be selling soon and the market will switch from buyers’ market to sellers’ market again and follow the cycles of the Market.
Understanding the timing is key to enter the real estate market. Current situation is similar to the year of 2004 and the market has 3 or more years to rally when flippers will be able to cash some money. The closer we get to 454 or the year 2020, the danger will increase. Buy now if you a Flipper and wait if you are a long term investor, because there will be a better chance down the road.
NZDUSD is showing 2 bullish patterns on the daily chart so we are expecting for the pair to continue higher. A move lower will now give bulls a chance to push the pair higher. Below we will show the possible bullish scenarios where bulls can enter the market and catch the move higher.
NZDUSD Daily Chart 2 Possible Bullish Patterns: Traders need to wait for NZDUSD to terminate red point C between the red AB 1.618% – AB 2.24% Fib. levels. A move lower from the suggested area to the red BC 0.50% Fib. retracement level will trigger BUYS. As long as price stays above the red point B low, watch for NZDUSD to make another swing higher. There is also strong support/resistance at the red BC 0.50% area which will allow a possible bounce higher. Watch for move higher towards the blue AB 2.24% Fib. level.
If looking to buy NZDUSD we prefer waiting for a retracement/pullback to trigger the red point D sell at the BC 0.50%. Stops should be placed at 0.6816 (point red B low) and should be bought at the BC 0.50% Fib. level minimum for a better risk/reward trade with targets above the blue AB 2.24% Fib. level.
Of course, like any strategy/technique, there will be times when the strategy/technique fails so proper money/risk management should always be used on every trade.
Back in November 2016, we mentioned that Gold should find buyers in 1540 – 1487 area and bounce ideally to resume the rally for new highs or in 3 waves at least. 3 weeks later, XAUAUD reached the mentioned area, it then found a low at 1525 on 12/15/2016 and started rallying. Yellow metal has reached 61.8 Fibonacci retracement (1728) of the drop from June 2016 peak and longs from 1540 should be risk free already. Today, we will take a look at the price action from 12/15/2016 low and the current forecast.
XAUAUD Weekly Elliott Wave View
Bigger picture in Gold-AUD remains unchanged. It’s showing 5 swings up from 2008 low which means the sequence is incomplete and calls for extension higher towards 2220 – 2441 area. Pull back in wave “x” reached 50% of wave “w” and is proposed completed at 1525. As dips hold above this level, rally is expected to continue towards 2220 – 2241 area. If pivot at 1525 low gives up during the current pull back, wave “x” could turn into a double three correction towards 1417 area but it should still remain bullish against 1280.52 low. This alternate view is less likely and should only be considered if the pivot or the low at 1525 breaks.
XAUAUD Elliott Wave Diagonal in wave (A)
Yellow metal has ended the cycle from 12/15/2016 (1525) low at 1727.59. Move up from 1525 low could be viewed as an Elliott Wave Diagonal structure i.e wave (A). A pull back in wave (B) should unfold in 3, 7 or 11 swings and hold above 1525 low for extension higher. 1626 – 1602 is 50 – 61.8 Fibonacci retracement area of wave (A) and could complete all of wave (B) or ideally complete just wave W of (B) which would be followed by a bounce in wave X and another push lower to complete wave (B). GCC (Wisdom Tree Commodity Index Fund) Elliott wave structure and sequences supports the idea of a double three correction in wave (B). We don’t like selling the yellow metal and expect dips to remain supported in 3, 7 or 11 swings as far as pivot at 1525 low remains intact.
XAUAUD FLAT in wave (X)
If the cycle from 6/6/2017 (1727.59) extends then, we could consider cycle from 12/15/2016 low to be over at 4/18/2017 (1712.75) i.e. wave (W) followed by a FLAT in wave (X) which should still end between 1618 – 1568 area and then we can see the yellow metal resuming the rally or making a larger 3 waves bounce at least.
Short term DAX Elliott Wave view suggests the rally from 5/18 is unfolding as a double three Elliott Wave structure. Minute wave ((w)) ended at 12879.5 and Minute wave ((x)) pullback ended at 12617. Internal of Minute wave ((x)) subdivided as an expanded flat Elliott Wave structure where Minutte wave (a) ended at 12633.5, Minutte wave (b) ended at 12922.5 and Minutte wave (c) of ((x)) ended at 12617. DAX has broken above Minutte wave (b) on 6/14, adding conviction that the next leg higher has started. Up from 12617, the rally is unfolding as a zigzag Elliott Wave structure where Minutte wave (a) ended at 12948.5 and Minutte wave (b) is proposed complete at 12701.5. Near term, while pullbacks stay above 12701.5, and more importantly above 12617, expect Index to extend higher. We do not like selling the Index.
DJI Futures Elliott Wave Analysis: Pull back in progress
Short term YM (DJI Futures) Elliott Wave view suggests the rally from 4/19 low is unfolding as a diagonal Elliott Wave structure where Minor wave 1 ended at 21010 (4/26), Minor wave 2 ended at 20474 (5/18), Minor wave 3 ended at 21494 (6/19). Minor wave 4 is in progress and subdivided into a double three Elliott Wave structure. Down from 6/19 peak, Minor wave 4 is expected to do 7 swings and reach 21257 – 21221 area. Index should then resume the rally looking for new highs or bounce in 3 waves at least. We don’t like selling the proposed pullback and expect buyers to keep appearing at extremes in the sequence of 7 or 11 swings as far as pivot at 5/18 (20474) low remains intact in the first degree and 4/19 (20311) low remains intact in the second degree.
YM (DJI Mini Futures) 1 Hour Elliott Wave Chart 06/23/2017
EURJPY Elliott Wave Analysis: Bullish against 123.6
Short term EURJPY Elliott Wave view suggests the decline to 122.35 on 6/15 low ended Intermediate wave (X). Rally from there is unfolding as a double three Elliott Wave structure where Minute wave ((w)) ended at 124.46 and Minute wave ((x)) ended at 123.62. Minute wave ((y)) is in progress and also unfolding as a double three. Near term focus is on 125.42 – 125.68 to complete Minutte wave (w) of ((y)). Afterwards, pair should pullback in Minutte wave (x) of ((y)) in 3, 7, or 11 swing before turning higher again, provided pivot at 123.6 low stays intact. We don’t like selling the pair.
IBB ( iShares NASDAQ Biotechnology Index ETF ) tracks the performance of a market-cap-weighted index of biotechnology and pharmaceutical companies listed on the NASDAQ. In this Technical Blog we’re going to take a quick look at the past Elliott Wave charts of IBB and we’re going to take a look at the price structures , count the swings and explain the forecast.
Early this year, the instrument made new highs and it was showing 5 swings from last year low which is considered as a bullish incomplete sequence. That’s why we were looking to buy the 6th swing pullback in 3 , 7 or 11 looking for a new leg to the upside or at least 3 waves bounce.
IBB Daily Swings 05/09/2017 The first 3 waves pullback from March peak only gave a reaction higher, then IBB turned lower looking to do the Double Three Correction toward equal legs area 282.95 – 278.66 where buyers were expected to show up to support the Index.
IBB Daily Chart 05/31/2017 On 05/31, IBB bounced perfectly from 100% of the move from 03/02 peak and then the instrument was expected to resume to the upside. The bounce higher allowed buyers to protect their position and get risk free.
IBB 4H Chart 06/02/2017 Finally, the index managed to make new highs above March peak and we were still calling for more extension to the upside. The first short term target area was achieved at 321 and pullbacks from there should remain supported in 3 , 7 or 11 swings while pivot at 290 low keeps holding.
Hello fellow traders. In this technical blog we’re going to present the past Elliott Wave charts of Hang Seng ( $HSI-HKG ) . As our members know, we were pointing out that Hang Seng is having incomplete bullish swings sequences in the cycles from the February 12th and December 30th 2016 lows. We advised members to avoid selling the index and keep buying the dips in 3,7,11 swings. In further text we’re going to take a look at our past forecasts, count the swings and see how we guided our members through this instrument.
HANG SENG HSI-HKG Daily chart 04.17.2017
At the chart below we can see 2 incomplete bullish cycles from the February’s and December’s lows. The index remains buy in a dips against the 23436.79 and 21482.4 pivots. First target area to the upside comes at 25176.21-26064.1
Now, let’s take a look at the short term structures to see where the entries were.
HANG SENG HSI-HKG 1 Hour chart 04.17.2017
The index is correcting cycle from the 23436.79 low, looking for another leg lower toward 23953.8-23633.4 ( potential buy zone) . Our forecast is calling for more strength once ((x)) pull back completes as Double three structure.
HANG SENG HSI-HKG 1 Hour chart 05.05.2017
Wave ((x)) correction reached proposed tech area at 23953.8-23633.4. The index found buyers as expected and made a nice rally from there. Wave ((x)) connector ended at 23728.56 low and we’re now having 5 waves rally from that low, labeled as wave (a) blue. Wave (b) pull back reached inner equal legs , and traders who missed entry from previous chart, can jump now in long trades at 24439.11-24288.02 area.
Note: Some labels have been removed in order to protect client’s privileges. Success in trading requires proper risk/money management, so does understanding of Elliott Wave theory, Cycle and Correlation analysis .
Short term EURJPY Elliott Wave view suggests the decline to 122.35 on 6/15 low ended Intermediate wave (X). Rally from there is unfolding as an impulse Elliott Wave structure with extension where Minute wave ((i)) ended at 124.46 and Minute wave ((ii)) ended at 123.62. Minute wave ((iii)) is in progress as 5 waves. After a short term pullback in Minutte wave (iv), another leg higher still can be seen in Minutte wave (v) to finish Minute wave ((iii)). Pair should then pullback in Minute wave ((iv)) before turning higher again. We don’t like selling the pair.
Short term EURJPY Elliott Wave view suggests the decline to 122.35 on 6/15 low ended Intermediate wave (X). Rally from there is unfolding as an impulse Elliott Wave structure with extension where Minute wave ((i)) ended at 124.46 and Minute wave ((ii)) ended at 123.62. Minute wave ((iii)) ended at 127.84 and Minute wave ((iv)) at 126.46. Up from there pair has broken above the wave ((iii)) peak suggesting the next leg higher in Minute wave ((v)) has started already and after a short term pullback in Minutte wave (ii) pair should see more upside. We don’t like selling the pair.
Short term Elliott wave view in USDX suggest that the cycle from 6/20 peak (97.88) is unfolding as an impulsive Elliott wave structure . This 5 wave move could be a wave A of an Elliott wave zigzag structure structure or a wave C of a FLAT correction. In either case, after 5 wave move ends, pair should pull back in 3 waves at least as the Elliott Wave Theory suggests. The Minute wave ((i)) ended at 97.16. Minute wave ((ii)) pullback ended at 97.46, Minute wave ((iii)) at 96.13 low, Minute wave ((iv)) pullback ended at yesterday’s peak 96.61. Below from there Minute wave ((v)) is in progress either in wave C or A, which already reached the minimum extension area in between inverse 1.236-1.618% extension area of previous wave ((iv)) at 96.02-95.83 area and also the 100% to 1.618% extension area of ((v))-((i)) target area at 95.86-95.51 area.
Which means cycle from 6/20 peak (97.88) is mature and pair can start the 3 waves bounce at any moment. However while below 96.61 peak another marginal push lower towards 95.51 area could be seen before ending the cycle. In case of further weakness in Minute wave ((v))) pair could see 0.618-0.764% fibonacci Extension area of wave ((i))+((iii)) at 95.55-95.29 area before ending the 5 waves impulse sequence from 6/20 peak. Afterwards, DXY should bounce in 3, 7 or 11 swings for the correction of 6/20 cycle before more downside is seen provided the pivot at 6/20 peak remains intact or If the bounce turns out to be stronger than expected and breaks the pivot at 6/20 peak (97.88) then that would suggest 5 wave move up from 97.88 low was part of a wave C of a FLAT from 6/14 (96.27) low and pair may resume higher.
Short term EURJPY Elliott Wave view suggests the decline to 122.35 on 6/15 low ended Intermediate wave (X). Rally from there is unfolding as an impulse Elliott Wave structure with extension. This 5 wave move could be a wave A of an Elliott wave zigzag structure structure, where Minute wave ((i)) ended at 124.46 and Minute wave ((ii)) ended at 123.62. Minute wave ((iii)) ended at 127.84, Minute wave ((iv)) at 126.46 and Minute wave ((v)) of A ended at yesterday’s peak 128.84. Near term, while bounces remain below there expect the pair to pull back in larger degree 3, 7, or 11 swings to correct cycle from 6/15 low before the rally resumes again. We don’t like selling the Index and expect buyers to appear after 7 or 11 swings pull back for extension higher. This view remains valid as far as pivot at 6/15 low 122.35 remains intact.
The development of computer technology and the Internet is perhaps the most important progress that shape and characterize the 21st century. The proliferation of computer-based and algorithmic trading breed a new category of traders who trade purely based on technicals, probabilities, and statistics without the human emotional aspect. In addition, these machines trade ultra fast in seconds or even milliseconds buying and selling based on proprietary algos.
No doubt the trading environment that we face today is completely different than the one in the 1930’s when Elliott first developed his wave principle. Legitimate questions arise whether Elliott Wave Principle can be applied in today’s new trading environment. After all, if it’s considered to be common sense to expect today’s cars to be different than the one in the 1930’s, why should we assume that a trading technique from 1930 can be applied to today’s trading environment?
What is ‘High-Frequency Trading – HFT’
High-frequency trading (HFT) is a program trading platform that uses powerful computers to transact a large number of orders at very fast speeds. It uses complex algorithms to analyze multiple markets and execute orders based on market conditions. Typically, the traders with the fastest execution speeds are more profitable than traders with slower execution speeds. The reason is the decision making process, which as Humans , we do not have the mental speed or power to execute at these higher levels which are almost 100% perfection.
High Frequency Trading (HFT) is controversial and has been met with some harsh criticism. Because of the used of mathematical models and algorithms to make decisions, taking human decision and interaction out of the equation. Decisions happen in milliseconds, and this could result in big market moves without reason and also make the Market less Human.
We have seen through the years an enormous amount of charts, we do an average of 3000 charts per month and we have looked very deep into the relationship between Elliott wave Theory and this new way of trading. We have found out there is a combination and have a lot to do with the Fibos relationship which created the wave patterns, instead of the Old way which most of the time was based in the 5 wave patterns and was associate to the crowd mod or way of thinking, meaning when the crowd is happy, Market goes higher, when the Crowd is pessimist the Market start dropping. It is always hard to change, but reality jump in and we were able to understand these Computers have some sort of triggers which determined when a cycle has ended and then the pattern start. It is a very simple process which starts from the Century charts and ended in mini seconds charts. This Computer is able to related and take decisions without any mistake, which related to Humans is an amazing improve, because of that, we always told members, the Market works perfectly and what we missed as Humans is the triggers which determined in a matter of second not to keep trading aside and switch to the other.
We called this Trigger the Distribution and it is a system in which sequences need to keep in one direction not only in price, but also in momentum, we as Human failed to take these decisions faster and with higher degrees of perfections, but the Machines do get it right most of the time. High Frequency Trading relates the Time frames and cycles and then created a main trend and a series of cycles within the Main trend; they keep either buying or selling the Trend until a cycle end. Many have been making counts in the $SPX Weekly charts and have created as much as possible 5 waves counts, have made ending diagonals within ending diagonals and the Index still keep going higher. The reality is that the High Frequency Trading Machines are buying the Index until the trend fail and in order not to happen a strong move to the downside need to happen to break what we called Pivots, which is another important aspect because they keep cycles within time frames to stay alive. In Reality Elliott wave was created or developments in the Market one way in 1930, but with the High Frequency trading ruling the Market since the Computer revolution these machines have changed the way for the Market to create the Pattern and consequently the way The Elliott wave Theory is seen. We have been working into this idea for years and have been able to find a system which make a mix between the Old Elliott wave Theory and most newly version which come with the High Frequency Trading as the one ruling the Market instead of the crowd sentimental , unless the Computers goes out Trading is hard to see The Elliott wave Theory the way it was, so better adjust to the time and become a better trader and join the one that ruling.
In this article we will take a look at Elliott Wave structure of CHF JPY pair since the low at 4.16.2017. Move up from 4.16.2017 (107.67) to 5.25.2017 (115.16) was in 7 swings and completed wave (W). Then we saw the pair pull back from the highs. Below is the 480 minute chart presented to clients on 11th June 2017 where we were looking for pair to end the correction in 112.87 – 111.52 area and resume the rally for new highs.
CHF JPY 11 June 480 minute chart CHF JPY 30 June 480 minute chart
Pair found buyers in the blue box between 112.87 – 111.52 and rallied to new highs as expected. With the latest rally from 112.46 – 117.78, pair is showing 5 swings up from 4.16.2017 low which is a bullish sequence and calls for more upside against 112.46 low to complete a double three Elliott wave structure. Pair has reached 0.618 – 0.764 Fibonacci extension area of (W)-(X) between 117.00 – 118.18 which is the typical area for 5th swing to end in a 7 swing sequence. Thus, we are expecting the pair to make a pull back in wave B and continue higher towards 119.95 – 121.72 area. We don’t like selling the pair in proposed wave B pull back and expect dips to find buyers in 3, 7 or 11 swings for continuation higher. If pair drops from here 116.23 – 115.94 would become next area of interest for wave B to complete and buyers to appear to start C leg higher or bounce in 3 waves at least.
Bitcoin is still considered as the currency of the Dark Web, despite the fact that it was the world’s best performing currency in 2015 & 2016 and currently 1 Bitcoin (BTCUSD) is worth 2 Ounces Of Gold which is significantly important in the financial world. The digital currency continued it’s outstanding performance during this year with and it’s up +260% but Ethereum has taking over the show with +3200% rise since January.
We implemented our Elliott Wave technique in our previous articles to predict the rise of Bitcoin and how it was looking to make new all time highs. Then we explained that despite BTCUSD was reaching a Warning Stage, it would remain bullish looking for more gains to come.
Bitcoin managed to reach $3000 on 06/12 which is new milestone for Bitcoin, then it saw a 30% correction which presented another opportunity to buy it again as we mentioned that the currency is a buy into dips using the corrective sequence 3 , 7 or 11 swings to find good entries. So let’s take a look at the current chart and see the potential coming move.
BTCUSD 4H Chart 07/01/2017 BTCUSD cycle from 2015 lows remain in progress and the instrument currently still has the potential to add another leg higher toward $3250 – $3500 at minimum before ending wave III and doing a larger pullback. However we need to keep in mind that the third wave is usually the strongest one and can keep adding more extension to the upside. Consequently, it’s not recommended to sell the instrument and until the pivot at 06/15 low 2120 gives up you should keep trading with the main bullish trend.
To add more conviction to the above view we can use a correlated different type of instrument and until the crypto-currency gets approved for it’s own proper ETF, we can use The Grayscale Bitcoin Investment Trust GBTC (Its shares represent almost 1/10 of a Bitcoin).
GBTC 1H Chart 06/12/2017 GBTC is sharing the same oscillation with Bitcoin with a slightly different cycle because the instrument did a double three structure to correct the whole cycle from 2016 low. It found buyers at extreme area 366-246 and now it could have started a new bullish cycle which can take it toward $870 – $940 area and that will support the Bitcoin move higher.
What would happen if both instruments fails to make new highs ?
In that case there is no need to panic because GBTC will extend it’s correction lower and can be bough later on at the next extreme area around $200 from May peak. If BTCUSD pivot at 2120 low gives up then wave III could be already in place and it will do the double correction from June peak toward $1930 – $1725 area which will be the next area to look for buyers.
Recap
BTCUSD bullish cycle remain in progress with a potential move higher toward $3250 – $3500 area which is also supported by the same oscillation in GBTC provided that June pivot keeps holding.
The crypto-currency market was extremely volatility in the recent months and it presents a lot of risk for short term trader, that’s why you need to have a good system that can help you define your trading areas and use the proper risk management to protect your account. So if you trade or invest in CryptoCurrencies and you are interested in further structures & sequences then you can start by learning the basics of the Elliott Wave theory.
GBPUSD Bullish Scenario: A bullish pattern can be seen for another possible move higher but has yet to trigger buys at the BC 0.50% Fib. level. If looking to buy GBPUSD traders should be patient and wait for price to make a move lower towards the BC 0.50% Fib. retracement level at 1.2808. Waiting for price to hit the BC 0.50% Fib. retracement will offer a better risk/reward trade setup. Blue bullish pattern is invalidated if price moves below point B low of the pattern.
Bullish Pattern
GBPUSD 4 Hour Bullish Pattern
GBPUSD Bearish Scenario: A bearish pattern can be seen for another possible move lower but has yet to trigger sells. If looking to sell GBPUSD traders should be patient and wait for price to make a move higher and hit the red entry trend line and possibly terminate point 5 with a reversal lower. If price hits the red trend line traders should also be watching possible candlestick trend reversal signals (Harami, Dark Cloud, Bearish Engulfing, Shooting Star, etc.) for more confirmation.
Bearish Pattern
GBPUSD Daily Chart Bearish Pattern
GBPUSD Weekly Chart Bearish Patterns: In 2015 and 2016 this bearish pattern formed and both times has reversed and hit targets. Only time will tell if 2017 bearish pattern will trigger and reverse lower to hit target.
Of course, like any strategy/technique, there will be times when the strategy/technique fails so proper money/risk management should always be used on every trade.
Short term EURJPY Elliott Wave view suggests the decline to 122.35 on 6/15 low ended Intermediate wave (X). Rally from there is unfolding as an impulse Elliott Wave structure with extension. This 5 wave move could be Minor wave A of an Elliott wave zigzag structure structure, where Minute wave ((i)) ended at 124.46 and Minute wave ((ii)) ended at 123.62. Minute wave ((iii)) ended at 127.84, Minute wave ((iv)) at 126.46 and Minute wave ((v)) of A is in progress towards 129.16 – 129.7.
Near term, while pair stays above 127.41, expect further upside towards the mentioned target. Afterwards, pair should pull back in larger degree 7 or 11 swings to correct cycle from 6/15 low before the rally resumes again. We don’t like selling the Index and expect buyers to appear after 7 or 11 swings pull back for extension higher. This view remains valid as far as pivot at 6/15 low 122.35 remains intact.
There has been a lot of headlines lately as the world’s new favorite cryptocurrency Ethereum (ETHUSD) soared +5,000% in value before the price dropped and it’s currently still up over 3,500%. Ethereum was only developed two years ago while bitcoin’s been around for almost eight years , many investors are expecting the ether token to take over in the coming months as it’s positioned to surpass bitcoin as the world’s largest cryptocurrency by market cap.
We discussed in our previous article how ETHUSD was leading the way for BTCUSD and we expected another leg higher to take place toward 315 – 365 which was achieved then surpassed as Ethereum managed to break the $400 handle before retracing lower. Let’s take a look at the 4H chart using Elliott Wave Theory to determine the next move.
ETHUSD 4H 07/01/2017 Ethereum did 7 swings sequence to end a double three correction around equal legs $228 – $193, then it started the bounce higher which allowed traders to protect their Long positions. So currently as the as the price stays above $203.9 level then ETHUSD should remain supported and extend to the upside looking for new highs or at least finish 3 waves bounce around $350 – $380.
ETHUSD Daily 07/01/2017 The pullback from 06/12 peak ended up by correcting the entire cycle from the lows, it reached the 50% of the rally around $205 and bounced from there. Consequently, the move higher has the potential to reach equal legs area $615 – $712 and even extend toward $870 it it turns out to be the 3rd wave of an impulsive move.
Recap:
Ethereum is currently the best performing currency for 2017 and it still has the potential for further gains in the second half of the year if the price manage to break above 06/12 peak. The move is expected to happen when Bitcoin starts it’s next leg higher which will drive more power to the rest of the digital market.
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