Video analysis of S & P 500

Gold Rally Is Imminent: How Prepared Are You?

Since 2011, Gold has been on a free fall from $1920.5 per ounce and now, only been supported by a psychological $1000 price level.

I labelled the rise to $1920.5 a 5-wave impulse.

From a larger forecasting point of view, Gold might still fall in the future to $671.11 after an expected rally to $1450-1500 price levels. All these will be, if the correction from $1920.50 will be a deep or complex zigzag corrective pattern.

Of course, we can always adjust our analytical forecast as price determines evolving patterns.

Right now, what we see is a clear 5-wave fall from $1920.50 which is labelled as the first leg of the correction of the impulse wave that ended in September 2011.

The weekly chart below shows this clearly.

The second leg, a prospective 3-wave rally, is expected to end around $1450-1500 price levels.

More so, the fifth wave of the impulse dip from $1920.50 is a clear ending diagonal pattern which gives us more confidence as to the expected rally. This is shown in the daily chart below.

$1000, a psychology price level, is expected to hold as a support. A dip below it could hamper the price of Gold going up.

A break above $1100.35 should trigger a long trade as price is expected to break above $1193.7 and to $1300.46 in the medium term.

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Audnzd: What We Expect Next

As a technical analyst, it's essential to learn different technical approaches to market prices.

Elliot wave theory, chart pattern analysis, fibonacci harmonic analysis, candlestick price action are some of the effective elements of technical armory every chartist must equip himself with.

On October 29th, an analysis was posted here on Audnzd titled Audnzd: Upward trend to continue?.  We discussed about a 5-wave bearish elliot wave impulse pattern as seen on the weekly chart.

After the end of the impulsive wave, a 3-wave correction , as expected, seems to have started as price rallied from 2015 low.

We narrowed down our elliot wave count to the hourly chart as we got a bullish trade set-up which we quickly shared with our subscribers.

All our profit targets were hit; though we were forced to close some of our trade before the final target due to a bearish reversal warning in the article titled: Audnzd: A Technical Combination.

Price rallied further, hit all targets and started falling as expected.

Will this fall continue or price will resume the rally?

The chart below is the recent weekly chart.

There is a prospective inverted head and shoulder reversal chart pattern subsumed in what could be a complete elliot wave cycle.



A complete elliot wave cycle is a 5-wave impulse trend wave followed by a 3-wave correction in the opposite direction of the trend.

With our wave count, we presume that price is still in the wave-C of the correction expected and the second wave of the C-wave is expected to end soon.

The 2nd wave of wave-C is a hourly tripple zigzag corrective pattern supported by a confluence zone.

If price is contained above 1.05 and rallied to break above 1.077, we will be prepared to get in line with a long position aiming 1.1548 as the final future price level.

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AudJpy May Continue Downside

We have been watching the long term historical activities of this pair for some time now but waiting for the right moment to follow the bearish trend move.

The move from 55.23 (in year 2000) to 108.275 ( in year 2007) was a clear 5-wave impulse (as illustrated in the chart below).

After such a move, one would expect a 3-wave correction (according to elliot wave theory). The corrections, though varying and complex in nature, are easy to spot.

The good thing about trading the elliot wave theory is that short term opportunities can be spotted within a large time frame and still following all the rules and guidelines of the wave theory. One can forecast a long term market move and trade clear patterns in the direction of the trend.

From 108.275 to 54.91 wave w ( a 3-wave decline) and back to wave x at 105.4 (a 3-wave rally), one can anticipate a double zigzag decline in labelled (W,X,Y in blue) which could end at 55 price level or below.

How can we take advantage of this forecast?, we can go to a lower time frame and read wave theory and price activities using combinations of technical tools.

The decline from 103.46 has completed the first leg of a double zigzag pattern and now correcting to 91.2 region. We expect price to be contained below 91.27 below the falling trendline. There is so much fibonacci ratios converging in that region. We expect it to be strong enough to keep the correction exhausted.

If there is a short opportunity below 91.27, a good ride could happen as we follow price decline further to 71.86

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All Eyes On GbpChf

In the last update on Gbpchf, (read) we were expecting price to rally in 3-wave to complete an ending diagonal which is meant to be the wave C of a larger degree flat corrective pattern.

It was maintained that

If price is contained below 1.5600 and breaks below the trendline connecting wave 2 and 4 of the diagonal, there will be an opportunity to put a long term sell order to ride to 1.38 and below.

 With a probable completion of the pattern, there is a high likelihood of a long term bearish move especially if price is maintained below 1.56.

A conservative long term trader can look for a bearish opportunity as price breaks below 1.4800 ( i.e the wave2-4 trendline)

An aggressive short term trader may enter earlier at the break of  1.5350 to ride to 1.4950 and below 1.4800.


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Will GbJpy crash again?.....And when?

The ending diagonal is one of the elliot wave patterns that I so delight in.
It shows a large reversal in the prevailing trend or counter-trend. The joy of watching price breaking the lower trendline (in a bullish market) and the upper trendline (in a bearish market) is characteristically fast and overwhelming.

On 13th august, I posted an analysis on GbpJpy where the fall in mid-august and early september were so pronounced. The analysis is titled GbpJpy: When will the bears take over? . It's a must read.

Just as the forecast was done, price fulfilled all the conditions and fell sharply.

After the fall, I tried to wonder what drives the diagonals. I posted the analysis titled : What drive the diagonals? on 23rd august. You may want to read it also.

The chart below shows the price movement after the diagonal price formation.

The chart above shows that price is moving in a 3-wave corrective pattern after the motive wave that broke the diagonal downside. There could still be more room for the bears to ride the price.

The yellow region 188.80 and 190 (a confluence zone) is projected for price to complete the correction.

We could see price at this zone after which a crash will be expected.
Price is expected to be contained below 190 for any chance for the bears in the nearest time.

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AudNzd: A Technical Combination!

In the last update on Audnzd I used different technical analysis, headed by the elliot wave theory, to forecast a probable upward move.

There was a condition for a bullish opportunity.

Price could trace down a bit before rallying to break the upper trendline upside. This will be a trading opportunity to buy this pair with a good risk/reward ratio.

There could be a trading opportunity to ride wave C to 1.2175

Gbpchf: The Long Term View

From the monthly chart below, it can be seen that Gbpchf has declined in 3-waves from 2.7328 to 1.13825 in a move that lasted for more than a decade.
The move is expected to be an impulse wave.

The rally from 1.13825 (2011 low) is expected to be the 4th wave of the impulse. Price has tried many times to break above 1.5600, which has now become a strong resistance.

The 4th wave which began at 1.13825 (2011 low) is getting set to complete a flat corrective pattern.

Flat patterns, according to elliot wave theory, are 3,3,5 patterns; the first wave wave is corrective (3-wave), the second wave is also corrective (3-wave) while the terminating wave (5-wave) is a motive wave (impulse wave or ending diagonal).

The weekly chart below shows the internal/building waves of this 4th wave.

The terminal wave of the flat correction is completing an ending diagonal. The 5th wave of the diagonal will be expected to be a 3-wave as indicated in the chart below.

If price is contained below 1.5600 and breaks below the trendline connecting wave 2 and 4 of the diagonal, there will be an opportunity to put a long term sell order to ride to 1.38 and below.

AudNzd: Upward Trend To Resume?

The bearish trend from 2011 was a clear impulse wave.

According to elliot wave theory, a 3-wave correction often follows a 5-wave trend. These corrections have different patterns; one of which is the zigzag pattern.

The 5-wave impulse in Audnzd ended and immediately started the 3-wave correction in April 2015.

Usdcad Taking One More Push Upside?

The price of Usdcad is predominantly determined by the crude oil markets. The negative correlation between them is so strong that as soon as oil price begins to fall, Usdcad immediately begins the rise in almost similar manner.

Since 2011, the trend of Usdcad has generally been bullish in what should be an impulse wave C of a cycle corrective ABC.

The C wave may have peaked at 1.3435 (100% fibonacci projection of wave A from B) but the impulse pattern doesn't look completed yet.

Price is probably in the 4th wave (a RUNNING FLAT corrective pattern shown in yellow) of the 5th wave of this impulse wave.

GbpJpy To Continue Downward?

The fast fall in the GbpJpy had been forecast after a very powerful reversal pattern showed up- I call the pattern the 'pregnant diagonal' i.e a diagonal pattern ending a larger degree diagonal pattern. You can read the forecast  GBPJPY

And then read how price react later after the pattern completed GBPJPY

The fall was fast just as expected knowing that a diagonal is often followed by a fast counter move to its starting point.

Continuation Of Eurusd Bullish Correction. How probable?

It's been long that I haven't updated on this pair. The last analysis titled Eurusd Intraday Update was about how far price has reacted after the rise from 1.046.

Price from 1.046 is clearly engaging in a correction after a long term bearish move. The correction was expected to be a double zigzag pattern

Eurusd Intraday Update

Over the week, price has reached our forecast target at 1.6-1.7 and immediately reacted there as it dipped in what looks like a correction. 

The alternate medium-term triangle projection did not hold and we can still stay with our original forecast of a {WXY} double zigzag correction of the bearish move that ended at 1.045 in March.

Follow the Gold Market

In the early stage of this millennium, we have seen Gold  very valuable commodity as it made a record high at $1920 per ounce. It was a clear impulse wave ( a strong trend).

According to the Elliot wave theory, price corrects in 3-waves after trending in 5-waves.
The sell off which started in 2011 after the record high should be a 3-wave correction. There are a number of corrective patterns as described by Elliot Wave Principle. One of these patterns is the Zigzag pattern.

EurUsd New Outlook

On 4th August, I posted a forecast titled Eurusd about to complete a triangle on Eurusd based on elliot wave analysis and followed the intraday moves on the Eurusd Intraday Analysis page.

The conclusive paragraphs of this analysis are quoted below.

"The [X] leg of the prospective double zigzag is about to complete a triangle (an elliot wave corrective pattern) and a break above the B-D triangle line will validate a move to advance Eurusd to 1.16-1.18.

Price is expected to complete the last leg of the triangle which should end at 1.081. A break below this level will invalidate the entire forecast."

EurAud Could be Exhausted Upside: Imminent Sell Off.

The price movement from 1.3655 in April 2015 after the completion of a diagonal pattern highlighted how important elliot wave patterns could be. The bullish move should never be mistaken for an impulse wave.

The fact that component waves are 3-waves shows that the entire movement is not impulse not to talk of how the entire movement was perfectly placed in a channel (which is not common to Impulse waves).

The pattern was forecast to be a triple zigzag (often formed within a channel) in the Intra-day analysis of Euraud.

Elliot wave stated clearly that after a corrective pattern, a motive wave should follow and if this pattern will hold, we might see price falling in months to come.

Meanwhile, price could go a bit higher but should be contained below 1.5700-50 before the sell off.

We are prepared to follow through: you can join the daily updated Intra day analysis of Euraud.

What Drive The Diagonals?

The diagonal pattern is one of the 2 motive waves discussed by the elliot wave theory. The diagonal is so often followed by a fast and high momentum breakout that it has become its 'after-formation' characteristic.

But, what drive the diagonals to behave so?

The close of trades of UsdJpy and GbpJpy last week showed clearly how price responds after a diagonal pattern has formed.

In the last post on GbpJpy titled GbpJpy: When Will The Bears take Over , I quoted thus:

"If price is contained below 195.755 and breaks 193.34, price could start a big fall to 190.863 (in the short term) and 173.553 as the final 'after-diagonal' price reaction target."

GbpJpy: When Will The Bears Take Over?

The weekly chart above shows the sell off from 252.167 to 118.161 in a supercycle bearish impulsive journey. After such an impulse wave, a correction would be expected. The correction started from 118.161 in a zigzag pattern.

Nzdyen Last Sell-off Leg Imminent?

The chart above shows that price is in a correction stage, wave 4 ( a probable zigzag) of an impulse cycle wave which started at 44.099 in 2009 and which is suppose to be the final advance (wave 5), of the larger term super cycle wave or part of it ( if cycle wave 5 will be extended).

Gbpusd: The Clear Picture.

In the LAST UPDATE on this currency pair, I wrote about a long term bearish bias. I also mentioned that in the hourly charts we might see some bullish move (especially if the rising trendline is not broken downside) before the bearish trend resumes.

A double zigzag correction to 1.65 was expected though the 'B' wave pattern of the zigzag was not so clear.

The 'B' wave now seem to form a triangle.

Price is expected to break above 1.571 to confirm the triangle formation.

In order for the triangle pattern to hold, price should not break below the ACE support line of the triangle.

Triangle patterns , according to elliot wave theory usually precede the end of a trend or correction. The formation of this triangle could mean that the correction upside is not over yet.