GOLD Breaks a Critical High, Weekend Review

By: Enda Glynn | Sat, Apr 8, 2017
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EURUSD

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EUR/USD 4-Hours Chart
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EUR/USD Daily Chart
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My Bias: short in wave 3 blue.
Wave Structure: downward impulse wave 1, 2 blue
Long term wave count: lower in wave 3 blue
Important risk events: EUR: N/A. USD: Fed Chair Yellen Speaks

Hi everyone.

Welcome to the weekend!

It has been a strange week in the markets I'm following.
With every confirmation of a wave count comes another question.
Thats the essense of life, and the markets, no one can be 100% sure of what will happen tomorrow,
We can read the signs and narrow down the possibilities though!
EURUSD declined again today, but the pattrern has a very corrective look to it.
I have scrapped the idea of an expanding triangle in wave 'ii' pink.
After today I am looking at a triple combination expanding flat in its stead.

Each wave seems to be increasingly complex, this is the definition of a corrective move unfolding before our very eyes.

The low at 1.0649 has taken on renewed significance, if the price moves above that point again, it will confirm wave 'c' green and likely travel to resistance at 1.0700 and slightly above.
And once that move completes,
A move below 1.0649 will confirm a move back into the down trend again.
This is what I am looking out for early next week.


GBPUSD

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GBP/USD 30-Minute Chart
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GBP/USD 4-Hour Chart
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Daily

GBP/USD Daily Chart
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My Bias: short below parity.
Wave Structure:  continuing impulsive structure to the downside in wave (5)
Long term wave count: decline in wave (5) blue, below parity
Important risk events: GBP: N/A. USD: Fed Chair Yellen Speaks

Cable joined the action with another impulsive wave to the downside, as expected.
I have labelled it as a possible developing wave 'iii' pink.
The price really must begin to cascade to the downside for this wave count to remain the favoured interpretation.

Third waves are the longest and strongest waves, so wave 'iii' pink should be no different.
I am watching for any shallow recovery into the 1.2400 region and then the price should turn down in a solid fashion.

I have placed a paralell trend channel around the price action off the wave (ii) high.
price must break below the lower trend line,
And begin to pick up momentum.


USDJPY

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USD/JPY 30-Minute Chart
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JPY/USD 4-Hour Chart
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USD/JPY Daily Chart
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My Bias: LONG
Wave Structure: rally in wave [C]
Long term wave count: wave [C] is underway, upside to above 136.00
Important risk events: JPY: N/A. USD: Fed Chair Yellen Speaks

We got some positive action today in USDJPY, which has saved the bullish outlook for the moment.
But the price cannot continue to languish in this 100 point range for any longer.
If wave (iii) green is underway, as I have labelled it so.
Then the market mus accelerate upwards and take out 112.20, to begin with.

The price came within pips of invalidation the bullish wave count today,
BUT;
The choppy action today can be viewed as a series of 1,2 waves to the upside.
Which would be very bullish.
Again, the bullish invalidation line lies at 110.10,
If the price drops below this line
it will mean wave '4' yellow is expanding and will complete at the previous lower target of 1.08.50.
With that in mind I have shown a downward parallel trend channel to illustrate that possibility.
For early trading next week,
Watch 112.20 for an upward break, which could possibly trigger a rising momentum move.


DOW JONES INDUSTRIALS

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Dow Industrials 30-Minute Chart
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Dow Industrials 4-Hour Chart
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Dow Industrials Daily Chart
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My Bias: market top is in.
Wave Structure: Impulsive 5 wave structure, possibly topping in an all time high.
Long term wave count: Topped in wave (5)
Important risk events: USD: Fed Chair Yellen Speaks

Todays sideways action is likely a continuation of wave '2' red.
If the market turns down again off 20727,
then wave '2' red traced out a running flat structure.
The downside potential next week is substantial given the current wave setup.
Wave 'iii' pink Should brink the market back down below the sacred 20000 level!

The best indication that the market has in fact turned down into the new bear market
is the recent wave 'ii' pink.
It traced out a clear three wave movement to the upside,
Which means it was a counter trend move.
So,
If an upside move is countertrend,
Then the downside must be the new trend.
The price ation off the all time high has now traced out a classic head and shoulders pattern.
Now is not the time to buy into this market.
This week also brought us another tried and tested sell signal - 'the skyscraper indicator'
plans have been announced for the 'worlds longest buliding' in New York.
Clearly these guys are not students of market cycles!
For next week 20514 remains the pivotal support line.


GOLD

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Gold 30-Minute Chart
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Gold Daily Chart
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My Bias: Long towards 1550
Wave Structure: ZigZag correction to the upside.
Long term wave count: Topping in wave (B) at 1500
Important risk events: USD: Fed Chair Yellen Speaks

GOLD finally broke the longer term bullish signal line today.
That line was at 1264.23, which I have mention quite a few times.
This was the high of the previous wave (b) blue.
The fact the market broke that level today points to a momentum shifting to the upside again.

I have labelled the recent action as waves '1,2' pink.
This wave coutn points to wave 'iii' brown extending to the upside which should continue next week.
For early trading next week, 1243.87, the low at wave 'ii' brown, must hold.
If that low breaks it will trigger an alternate wave count where wave (ii) blue extends.

Thats it for this week.
Hope you all have a great weekend.
See you all on Monday evening.

 


 

Enda Glynn

Author: Enda Glynn

Enda Glynn
bullwaves.com

Enda Glynn

I class myself as an Elliott wave trader now, but that's not how I started out though! It took me a long time and a whole lot of pain, to finally understand what drives the price and how to use Elliott Wave correctly!

I have been trading for years and I have tested every trading system and strategy under the sun! I used to pick entry points at random based on emotion or news events or something I heard on TV! It did not take long to destroy my capital! I have blown out my account balance before, and I had to start again,

from scratch!

Believe me, I am well acquainted with failure in trading! Im sure that the above scenario is pretty familiar to you too. We have all been there. About 10 years ago I discovered The Elliott wave Principle and its method of market analysis. Since then, I have spent years learning, testing and trading, using the wave principle as the backbone of my analysis. I even went to college to study macroeconomics and econometrics. I graduated with honours degree back in 2012. The financial market knowledge and statistical edge I gained after my degree added another level to my trading. The difference in my trading approach using the wave principle, compared to before, is like night and day.

The price started to move "my way" more and more often. The wave model, offers me a lens to view market action through, which no other form of analysis can do. Elliott wave analysis, helps me answer four key questions when I am contemplating a trade:

• What direction the price is trending.
• How far is this trend likely to go.
• Where can I enter a trade with the best risk reward ratio.
• And most importantly, at what point am I definitely wrong?!

The wave principle helps me improve my trade entry, tighten up my money management and in turn increase profitability. Seeing the waves unfold before your eyes is a very rewarding experience, It is almost like peering into the future! That is how the wave principle helps my trading, and that is why the wave principle will improve your trading. It took a long time to finally master Elliott Wave Principle. After over a decade of hard work, research and learning I can call myself an expert in the field. I regularly contribute to major trading communities at FXStreet, Forex Factory, Traders Planet. I am a chief Elliott Wave analyst at HumbleTraders.

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