Category Archives: Public Analysis

GOLD Elliott Wave Technical Analysis – 21st April, 2017

A weak upwards day exactly fits the expectation from last analysis.

Summary: The correction is still most likely incomplete. It may continue further for yet another one to few days. Thereafter, the upwards trend should resume. The target for long positions remains at this stage at 1,333. If this is wrong, it may not be high enough.

New updates to this analysis are in bold.

Grand SuperCycle analysis is here.

Last monthly and weekly charts are here.

MAIN ELLIOTT WAVE COUNT

DAILY CHART – DETAIL

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This chart steps back to see all movement since the important low on the 3rd of December, 2015.

To see how this fits into the bigger picture, please see the last historic analysis linked to at the start of this analysis.

The first upwards movement labelled primary wave 1 fits well as a five wave impulse. Primary wave 2 fits as a zigzag. It would be difficult to see the downwards wave of primary wave 2 as an impulse because that would require ignoring what looks very much like a triangle at its start (labelled intermediate wave (B) ). To see this as an impulse that movement would need to be a second wave correction, but second waves do not subdivide as triangles.

Primary wave 3 should have begun. Within it intermediate waves (1) and (2) should be complete. Intermediate wave (2) is a very common expanded flat correction.

My only concern at this stage is the labelling of minute wave iii as complete. It is possible that the middle portion of this third wave at three degrees has passed, if the next waves up for minute wave v and minor wave 5 are both very long and strong extensions.

It may also be possible that the middle of the big third wave has not passed and the degree of labelling within minor wave 3 needs to be moved down one degree. If minute wave ii is yet to unfold, it may not move beyond the start of minute wave i below 1,240.24.

DAILY CHART

Gold Elliott Wave Chart Daily 2017
Click chart to enlarge.

This daily chart will suffice for both weekly charts, which can be seen in the last published historic analysis.

Upwards movement at primary degree is either a third wave (first weekly chart) to unfold as an impulse, or a Y wave (second weekly chart) to unfold as a zigzag. If upwards movement is a zigzag for primary wave Y, then it would be labelled intermediate waves (A) – (B) and now (C) to unfold. It is most likely a third wave because cycle wave a is most likely to subdivide as an impulse.

Intermediate wave (1) or (A) is a complete five wave impulse lasting 39 days. Intermediate wave (2) or (B) looks like an expanded flat, which is a very common structure.

So far, within intermediate wave (3) or (C), minor waves 1 and 2 are now complete. Minor wave 3 looks to have begun. Within minor wave 3, the middle portion for minute wave iii may now be complete. Minute wave iv may not move into minute wave i price territory below 1,261.00.

Minute wave v is expected to be very strong, possibly ending with a blow off top.

A cyan trend line is added to all charts. Draw it from the high in October 2012 to the high in July 2016. This line has been tested five times. Price is finding resistance at the cyan trend line now. If price can break through resistance here after some consolidation, then that may release energy to the upside for the end of minor wave 3.

HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

Minute wave ii was a deep 0.79 double zigzag, which lasted 25 hours, and on the daily chart it shows as only one session.

Given the guideline of alternation, minute wave iv may be expected to most likely be a flat, combination or triangle. All of these structures may include a new high above its start at 1,294.96 as part of the correction. A new high does not indicate minute wave iv is over.

Combinations, flats and triangles are all usually more longer lasting structures than zigzags.

At this stage, a flat correction for minute wave iv may be ruled out because there is no upwards wave within it that has retraced a minimum 0.9 length of any downwards wave within it. The minimum length for minuette wave (b) within a flat correction for minute wave iv has not been met.

A triangle does not look likely at this stage. Often MACD hovers about the zero line while a triangle unfolds. If it starts to do that and price just meanders sideways, then a triangle would be indicated and published again.

A combination looks most likely at this stage.

If minute wave iv is a combination, then the first structure within it labelled minuette wave (w) may be a complete zigzag.

The two structures in the double may be joined by a complete three in the opposite direction labelled minuette wave (x), which subdivides as an expanded flat correction.

Minuette wave (y) may have begun. It may be either a flat or a triangle.

At this stage, minuette wave (y) looks like it may be continuing further as a flat correction. Within the flat correction, subminuette wave b must retrace a minimum 0.9 length of subminuette wave a. Subminuette wave c would then be very likely to end at least slightly below the end of subminuette wave a at 1,276.96 to avoid a truncation and a very rare running flat.

If minuette wave (y) is a flat correction, then at its end it will have to break below the parallel copy of the best fit channel, copied over from the daily chart. Fourth waves are not always neatly contained within channels.

It is also possible that minuette wave (y) may yet unfold sideways as a triangle and remain all or almost all within the best fit channel.

Minute wave iv may not move into minute wave i price territory below 1,261.00.

ALTERNATE HOURLY CHART

Gold Elliott Wave Chart Hourly 2017
Click chart to enlarge.

What if minute wave iv is over, finding support close to the lower edge of the best fit channel?

This is only possible if it is seen as a complete double zigzag. Minute wave ii fits as a double zigzag.

Alternation is a guideline and not a rule; it does not have to be seen. Very occasionally second and fourth waves do take the same structural form. Because this is not common, the probability of this wave count is low.

There would be alternation in depth: minute wave ii was a very deep 0.79 correction while minute wave iv is a shallow 0.36 correction.

If price can break above the cyan trend line early next week, then this wave count would increase in probability to be the main wave count. At that stage, expect a strong increase in upwards momentum and look out for a blow off top.

Within minute wave v, the upcoming correction for minuette wave (ii) may not move beyond the start of minuette wave (i) below 1,276.96.

TECHNICAL ANALYSIS

WEEKLY CHART

Gold Weekly 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

There are a lot of assumptions out there about Gold and its relationships to various other markets. Happily, there is a quick and easy mathematical method to determine if Gold is indeed related to any other market: StockCharts have a “correlation” option in their indicators that shows the correlation coefficient between any selected market and the one charted.

The correlation coefficient ranges from -1 to 1. A correlation coefficient of 1 is a perfect positive correlation whereas a correlation coefficient of -1 is a perfect negative correlation.

A correlation coefficient of 0.5 to 1 is a strong positive correlation. A correlation coefficient of -0.5 to -1 is a strong negative correlation.

Any two markets which have a correlation coefficient that fluctuates about zero or spends time in the 0.5 to -0.5 range (shown by highlighted areas on the chart) may not be said to have a correlation. Markets which sometimes have a positive or negative correlation, but sometimes do not, may not be assumed to continue a relationship when it does arise. The relationship is not reliable.

For illustrative purposes I have included the correlation coefficient between Gold and Silver, which is what strong and reliable correlation should look like.

Gold made a higher high and a higher low this week, although the candlestick has closed red. An increase in volume is bullish. The long lower wick on the candlestick is also bullish although the colour is bearish.

ADX does not yet indicate a trend. If it reaches 15 or above, then it would indicate an upwards trend. RSI indicates there is still plenty of room for price to rise. This chart is bullish.

DAILY CHART

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

I do not have confidence in the data from StockCharts for the daily candlestick for the 12th of April. As the session ended, I did not see a spike down to 1,278, which is their close, and creates the long upper wick on their candlestick.

The long lower wicks on the last four daily candlesticks are bullish.

Volume indicates the last two upwards days may be still part of a consolidation and not yet the resumption of the upwards trend. This favours the main hourly Elliott wave count.

The only concern here for the main hourly Elliott wave count is ADX at almost extreme. Usually, when the black ADX line reaches above both directional lines the trend ends there or within a day or two. This may favour the main Elliott wave count; a couple of days of further consolidation with a slightly deeper move at the end may flatten the black ADX line allowing it to draw away from the +DX line. Alternatively, a strong upwards move may pull the +DX line back above the ADX line.

Price may find support about the Fibonacci 13 day moving average.

The short and mid term moving averages have a positive slope and price is above both. An upwards trend for the short and mid term is indicated. The long term 200 day moving average may be flattening off; it is still declining but only very slightly. If it begins to have a positive slope, it may be rolling over.

GDX

DAILY CHART

GDX Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

Price is back within the prior consolidation zone. This zone is now widened. There is some distance to go before price may find support about 22.50.

With ATR declining, ADX declining, and Bollinger Bands tightly contracted, this downwards movement looks like a pullback and not a new downwards trend. Support is about 22.75 and next about 22.50.

STUDY OF A THIRD WAVE IN $GOLD

Gold Daily 2016
Click chart to enlarge.

This study of a third wave will be left in daily analysis until the current third wave is either proven to be wrong (invalidated) or it is complete.

This third wave spans 59 trading days.

It was not until the 40th day that the overlapping ended and the third wave took off strongly.

The middle of the third wave is the end of minute wave iii, which ended in a blow off top.

There is excellent alternation between second and fourth wave corrections.

This third wave began with a series of five overlapping first and second waves (if the hourly chart were to be added, it would be seven) before momentum really builds and the overlapping ends.

The fifth wave of minuette wave (v) is the strongest portion.

This third wave curves upwards. This is typical of Gold’s strong impulses. They begin slowly, accelerate towards the middle, and explode at the end. They do not fit neatly into channels. In this instance, the gold coloured curve was used.

Gold Daily 2016
Click chart to enlarge. Chart courtesy of StockCharts.com.

This trend began after a long consolidation period of which the upper edge is bound by the blue trend line. After the breakout above the blue trend line, price curved back down to test support at the line before moving up and away.

RSI reaches overbought while price continues higher for another five days and RSI reaches above 85. The point in time where RSI reaches overbought is prior to the strongest upwards movement.

ADX reached above 35 on the 9th of February, but price continued higher for another two days.

The lesson to be learned here: look for RSI to be extreme and ADX to be extreme at the same time, then look for a blow off top. Only then expect that the middle of a big third wave is most likely over.

The end of this big third wave only came after the blow off top was followed by shallow consolidation, and more highs. At its end RSI exhibited strong divergence with price and On Balance Volume gave a bearish signal.

Third waves require patience at their start and patience at their ends.

This analysis is published @ 09:25 p.m. EST.

[Note: Analysis is public today for promotional purposes. Trading advice and member comments and discussion will remain private.]

Continue reading GOLD Elliott Wave Technical Analysis – 21st April, 2017

US OIL Elliott Wave Technical Analysis – 19th April, 2017

A break below the small best fit channel on the daily chart indicated a trend change for US Oil.

Members were then advised to enter a short position. Short positions are now positive.

Summary: The target is at least a new low below 47.06; it should be comfortably below that point.

New updates to this analysis are in bold.

MONTHLY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Monthly 2016
Click chart to enlarge.

Within the bear market, cycle wave b is seen as ending in May 2011. Thereafter, a five wave structure downwards for cycle wave c begins.

Within cycle wave c, at this stage it does not look like primary wave 5 could be complete. That would only be possible if primary wave 4 was over too quickly.

Primary wave 1 is a short impulse lasting five months. Primary wave 2 is a very deep 0.94 zigzag lasting 22 months. Primary wave 3 is a complete impulse with no Fibonacci ratio to primary wave 1. It lasted 30 months.

Primary wave 4 is likely to exhibit alternation with primary wave 2. Primary wave 4 is most likely to be a flat, combination or triangle. Within all of these types of structures, the first movement subdivides as a three. The least likely structure for primary wave 4 is a zigzag.

Primary wave 4 is likely to end within the price territory of the fourth wave of one lesser degree; intermediate wave (4) has its range from 42.03 to 62.58.

If primary wave 4 is incomplete, then it looks like it may not remain contained within the channel. Sometimes fourth waves overshoot channels and this is why Elliott developed a second technique to redraw the channel when it does not contain a fourth wave.

Primary wave 4 is most likely to be shallow to exhibit alternation in depth with primary wave 2. So far it has passed the 0.382 Fibonacci ratio at 45.52. It may now continue to move mostly sideways in a large range.

Primary wave 4 may not move into primary wave 1 price territory above 74.96.

At this stage, primary wave 4 has completed intermediate wave (A) only. Intermediate wave (B) is incomplete.

WEEKLY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Daily 2016
Click chart to enlarge.

The whole structure of primary wave 4 is seen here in more detail.

The first wave labelled intermediate wave (A) is seen as a double zigzag, which is classified as a three.

Intermediate wave (B) is also a three. This means primary wave 4 is most likely unfolding as a flat correction if my analysis of intermediate wave (A) is correct. Flats are very common structures.

Intermediate wave (B) began with a zigzag downwards. This indicates it too is unfolding most likely as a flat correction.

Within intermediate wave (B), the zigzag upwards for minor wave B is a 1.29 correction of minor wave A. This indicates intermediate wave (B) may be unfolding as an expanded flat, the most common type.

The normal range for intermediate wave (B) within a flat correction for primary wave 4 is from 1 to 1.38 the length of intermediate wave (A) giving a range from 26.06 to 16.33.

Primary wave 4 may not move into primary wave 1 price territory above 74.96.

Within the larger expanded flat correction of primary wave 4, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 28.61 or below.

DAILY ELLIOTT WAVE COUNT

US Oil Elliott Wave Chart Daily 2016
Click chart to enlarge.

Minor wave C downwards must subdivide as a five wave structure.

Within minor wave C, minute waves i and ii should be complete and minute wave iii must be incomplete. Upwards movement, which is labelled minuette wave (ii), cannot be minute wave iv as it overlaps back into minute wave i price territory.

Within minute wave iii, minuette wave (i) is complete and minuette wave (ii) now looks most likely to be over.

A small best fit channel is drawn about the zigzag of minuette wave (ii). This channel is now breached providing trend channel confirmation of a trend change. This wave count would now expect an increase in downwards momentum.

Minuette wave (iii) must make a new low below the end of minuette wave (i) at 47.06. It must move far enough below that point to allow for subsequent upwards movement for minuette wave (iv) to unfold and remain below minuette wave (i) price territory.

Within minuette wave (iii), no second wave correction may move beyond the start of its first wave above 53.76.

The cyan trend line is drawn from the high labelled minor wave B to the next swing high labelled minute wave ii. This is a Magee trend line for a bear market. Expect that US Oil is most likely in a downwards trend as long as price remains below this cyan trend line.

TECHNICAL ANALYSIS

DAILY CHART

US Oil Chart Daily 2015
Click chart to enlarge. Chart courtesy of StockCharts.com.

The candlestick of the 12th of April completes a Bearish Engulfing Candlestick reversal pattern. The important condition for this pattern (where the close of the second candlestick is below the open of the first) is met. This is one of the most reliable reversal patterns. It works more often than not, but not always. An example of it not working is shown on the 3rd of April.

The reversal pattern of the 12th of April has support from volume whereas the 3rd of April did not. This increases the probability that price may reverse here.

The long lower wick on the last daily candlestick for the 18th of April is bullish, as is stronger volume to support upwards movement of price during the session (indicated by On Balance Volume moving higher for this session). This bounce may move a little higher.

New trend lines are drawn on On Balance Volume. These do not yet have good technical significance, so a breach here would be only a weak signal.

VOLATILITY INDEX

OVX Chart Daily 2015
Click chart to enlarge. Chart courtesy of StockCharts.com.

Normally, volatility should decline as price rises and volatility should increase as price falls. Divergence from this normal can provide a bullish or bearish signal for Oil.

For the last session, here dated the 18th of April, volatility has declined below the 11th of April but price has not made a new high. This divergence is bearish and supports the idea of a trend change here for Oil.

This analysis is published @ 03:07 a.m. EST.

[Note: Analysis is public today for promotional purposes. Member comments and discussion will remain private.]

Continue reading US OIL Elliott Wave Technical Analysis – 19th April, 2017

Trading Room – 17th April, 2017

Today’s Trading Room looks at Copper, US Oil and GBPUSD.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Members were advised to enter short on the 10th of April. Stops were initially set just above 2.700 and are now moved down to breakeven to eliminate risk.

On the 12th of April Copper had a classic downwards breakout from a consolidation zone, supported by volume. Now price is turning up to test resistance at prior support, about 2.590. The downwards session for the 12th of April has strong volume. The last upwards session for the 13th of April has lighter volume. Volume is bearish.

The long upper wick on the candlestick for the 13th of April is bearish.

On Balance Volume is bearish. RSI is not extreme, so there is plenty of room for price to fall. ADX is still below 15 and does not yet indicate a new trend. Bollinger Band expansion indicates volatility returning after the consolidation; with price moving lower as Bollinger Bands expand, this is bearish.

ATR may be expected to begin to increase after a period of a small range.

Stochastics is not yet oversold. This may remain extreme for long periods of time during a trending market. Only when it has been extreme for some time and then exhibits divergence with price while extreme should it be read as a strong warning sign of an impending trend change. That is not the case yet.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The doji candlestick for February puts the trend from up to neutral.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The upper edge of the blue channel has still provided resistance, with a strong overshoot for the 30th of March. Copper may in the early stages of a third wave at three degrees now and this should see an increase in downwards momentum.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The red daily candlestick of the 12th of April completes a Bearish Engulfing Candlestick pattern. This is the most reliable of candlestick reversal patterns when it comes after an upwards trend. It doesn’t always work (it didn’t work on the 3rd of April), but it works more often than not. It is supported by volume. The last upwards day for the 13th of April did not have support from volume. This is also bearish.

Overall, this chart is more bullish than bearish.

Members were advised that I entered short Oil on the 12th of April. At this stage, this position is now positive.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

The basis for entering short was price breaking below the lower edge of the small gold channel that contains the upwards wave labelled minuette wave (ii).

Now price may be beginning to move down and away.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

GBPUSD

TECHNICAL ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The prior pennant pattern is no longer correct.

The last daily candlestick for the 13th of April is bearish and has support from volume.

ATR and Bollinger Bands show there is something wrong with this upwards trend due to a lack of range and volatility. This trend is relatively weak at this stage.

VOLUME ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge.

The bearish signal given in last analysis for On Balance Volume was negated. The support line is redrawn. On Balance Volume is constrained, giving no signal today.

ELLIOTT WAVE ANALYSIS

GBPUSD Chart Monthly 2017
Click chart to enlarge.

Cycle wave c needs to complete as a five wave structure. The final fifth wave is incomplete and may only have just begun. The target expects to see the most likely Fibonacci ratio between primary waves 5 and 1.

GBPUSD Chart Daily 2017
Click chart to enlarge.

Primary wave 4 fits perfectly as a regular contracting triangle, offering perfect alternation with the zigzag of primary wave 2. Primary wave 2 lasted 2 months and primary wave 4 lasted 6 months. Triangles are usually longer lasting structures than zigzags, so this disproportion is not only acceptable but should be expected. This wave count has the right look.

The breakout from the triangle should be down.

Minor wave 2 moved higher and fits perfectly as an expanded flat correction. These are very common structures. The choice to try another short position here is based heavily on the three wave structure of minute wave b; with a three down following minor wave 1, only an expanded flat following an impulse will fit. The trend should therefore be down if this Elliott wave analysis is correct.

Minor wave 2 may not move beyond the start of minor wave 1 above 1.26157.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

Trading advice for gold given to Elliott Wave Gold members will be included in Trading Room summary tables. However, so that it remains private for Elliott Wave Gold members only, it will not be included in Trading Room posts.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

Each month a new “closed positions” table will begin. To see all closed positions for March 2017 see the last Trading Room post for March here.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

Members will be updated with trading advice over the next week here in comments for Trading Room. Comments are therefore private, for members only.

This analysis is published @ 03:39 a.m. EST.

[Note: Member comments and discussion will remain private.]

Continue reading Trading Room – 17th April, 2017

Trading Room – 9th April, 2017

Today’s Trading Room looks at Copper, Natural Gas and GBPUSD.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Last Trading Room advice to Elliott Wave Gold members advised to enter short with a stop just above 2.717. Members were advised that short positions should become profitable within 24 hours, which is what happened, and that stops should have been then moved to breakeven. The whipsaw of the 5th of April should have closed short positions for no loss.

Copper is now range bound with resistance about 2.70 and support about 2.59 (with overshoots). Volatility declines as price moves sideways, ATR remains very low and flat, and ADX indicates a consolidating market.

In the short term, the very long lower wick for the candlestick of the 7th of April indicates upwards movement is likely to begin the new trading week.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The doji candlestick for February puts the trend from up to neutral.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The upper edge of the blue channel has provided resistance, with a strong overshoot for the 30th of March. Copper may be ready to move lower in a third wave at three degrees now and this should see an increase in downwards momentum.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

Natural Gas

TECHNICAL ANALYSIS

Natural Gas Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Last trading advice for Natural Gas to Elliott Wave Gold members on the 31st of March was:

A trade set up is not seen at this time. Look for price to pullback to touch the green Magee trend line on the TA chart. If that happens, then enter long with a stop just below the line. Allow for overshoots, but exit long positions if the line is breached.

The Magee trend line was touched again on the 4th of April. This was the signal to enter long according to trading advice given. That best case entry point would have been at the low of the day at 3.122, but in reality members may not have entered exactly at the price point where price touched the line. However, any long positions should now be profitable and stops may be moved up to protect a little profit.

The Magee trend line may be used now as a trailing stop for long positions.

ADX indicates an upwards trend and RSI allows further room for price to rise. Stochastics is overbought and exhibits divergence with price, but this oscillator may remain extreme for long periods of time when this market trends. The bottom line is any pullbacks may be expected to find support at the green Magee trend line.

On Balance Volume is now bound within a small range. Watch this carefully; if it breaks below the yellow support line, it would indicate a deeper pullback may be underway; if it breaks above the purple resistance line, it would indicate an increase in upwards momentum.

ELLIOTT WAVE ANALYSIS

Natural Gas Chart Daily 2017
Click chart to enlarge.

The last Elliott wave count was invalidated with a new high this week above 3.174. Cycle wave b may be continuing higher as a double zigzag.

Natural Gas Chart Daily 2017
Click chart to enlarge.

MACD indicates an increase in momentum to support this third wave up.

When minor wave 3 is complete, then minor wave 4 may not move into minor wave 1 price territory below 3.088.

The gold channel’s lower edge is the same as the green Magee trend line on the daily technical analysis chart. Price should continue to find support at the lower edge while minor wave 3 continues.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

GBPUSD

TECHNICAL ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Price looked like it was forming a Pennant pattern. What StockCharts data does not show today is the daily candlestick for the 7th of April that broke out of the pattern to the downside. The candlestick is shown today on FXCM data below.

VOLUME ANALYSIS

GBPUSD Chart Daily 2017
Click chart to enlarge.

On Balance Volume gives a bearish signal with a break below the short term yellow support line. The downwards breakout from the pennant pattern has support from volume for a strong downwards day.

ELLIOTT WAVE ANALYSIS

GBPUSD Chart Monthly 2017
Click chart to enlarge.

Cycle wave c needs to complete as a five wave structure. The final fifth wave is incomplete and may only have just begun. The target expects to see the most likely Fibonacci ratio between primary waves 5 and 1.

GBPUSD Chart Daily 2017
Click chart to enlarge.

Primary wave 4 fits perfectly as a regular contracting triangle, offering perfect alternation with the zigzag of primary wave 2. Primary wave 2 lasted 2 months and primary wave 4 lasted 6 months. Triangles are usually longer lasting structures than zigzags, so this disproportion is not only acceptable but should be expected. This wave count has the right look.

The breakout from the triangle should be down.

Within minor wave 3, no second wave correction may move beyond the start of its first wave above 1.25620.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

Trading advice for gold given to Elliott Wave Gold members will be included in Trading Room summary tables. However, so that it remains private for Elliott Wave Gold members only, it will not be included in Trading Room posts.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

Each month a new “closed positions” table will begin. To see all closed positions for March 2017 see the last Trading Room post for March here.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

This analysis is published @ 06:48 p.m. EST.

Trading Room – 31st March, 2017

Today’s Trading Room looks at Copper and Natural Gas.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The last trade for Copper was closed on the 27th of March.

Now Copper has moved higher.

The long lower wick of the 27th of March is bullish. Now the long upper wick of the 30th of March is bearish. A reasonable expectation would be for Copper to print at least one red daily candlestick next.

Strong volume for a session with the balance of volume downwards supports downwards movement.

On Balance Volume may find some support at the yellow trend line, but this line does not have much technical significance as it is steep and only tested twice before. The purple line does offer reasonable significance, so this may halt a fall in price.

Copper is range bound with resistance about 2.700 and support about 2.560. During this range bound period, it is two downwards days that have strongest volume suggesting a downwards breakout is more likely than upwards.

TREND LINE

Copper Chart Monthly 2017
Click chart to enlarge.

Copper has found very strong resistance at the green trend line, which goes back to at least August 2011. The doji candlestick for February puts the trend from up to neutral.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The upper edge of the blue channel has provided resistance, with a strong overshoot for the 30th of March. Copper may be ready to move lower in a third wave at two degrees and this should see an increase in downwards momentum.

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Natural Gas

TECHNICAL ANALYSIS

Natural Gas Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Natural Gas is now in an upwards trend. The breach of the blue bear Magee trend line indicated a trend change from bear to bull.

Now a new trend line is drawn for the new bull trend in green, so expect corrections to find support at this line. If it is breached, it would indicate a change.

Next resistance is about 3.550.

There is strong volume for upwards movement in recent sessions. The new trend has support from volume.

On Balance Volume is constrained within sloping lines. A breakout would be a bullish or bearish signal.

Stochastics can remain extreme for reasonable periods of time. With price sitting close to upper edge of Bollinger Bands and Stochastics exhibiting divergence with price at highs while extreme, it looks like in the short term a small pullback may unfold.

ELLIOTT WAVE ANALYSIS

Natural Gas Chart Daily 2017
Click chart to enlarge.

The last Elliott wave count was invalidated with a new high this week above 3.174. Cycle wave b may be continuing higher as a double zigzag.

Natural Gas Chart Daily 2017
Click chart to enlarge.

The downwards wave labeled primary wave X is now a complete structure. It fits best and looks most like a three wave movement.

Intermediate wave (B) may not move beyond the start of intermediate wave (A) below 2.522.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

Trading advice for gold given to Elliott Wave Gold members will be included in Trading Room summary tables. However, so that it remains private for Elliott Wave Gold members only, it will not be included in Trading Room posts.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

Trades advised to Elliott Wave Gold members for Gold have now been included in Trading Room summary tables.

*FTSE was a weak recommendation. Advice was given to only invest 1-2% of equity on this trade.

RECOMMENDATIONS

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DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

This analysis is published @ 02:53 a.m. EST.

Trading Room – 27th March, 2017

Today’s Trading Room looks at Copper, US Oil and FTSE.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Copper has made a series of lower lows and lower highs (the definition of downwards movement) since the 13th of February. This downwards movement is choppy and overlapping though.

The very short term suggests volume may provide support for a little more upwards movement. If the trend is down, then price should not make a new high above 2.700.

Long lower wicks on the last three daily candlesticks also looks bullish for the short term.

On Balance Volume gives a bearish signal on the 23rd of March, which should be given reasonable weight.

With low ADX and ATR, there is plenty of room for a new trend to develop.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The lower edge of the gold channel did provide support; price bounced up from there. The upper edge should provide resistance.

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US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The trend is not yet extreme. There is room still for it to continue. When Oil trends strongly, ADX can remain above 35 and above both directional lines for several days before the trend ends.

There is some concern today that the next movement down is not yet underway. The correction which price moved into on the 15th of March may still be underway. Slight divergence at the last low between Stochastics and price, and RSI and price, looks slightly bullish. The long lower wick on the candlestick for the 22nd of March looks bullish.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

If the Elliott wave count is correct, then the correction should be over. If it were to continue, then it would be grossly disproportionate to subminuette wave ii.

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FTSE

TECHNICAL ANALYSIS

FTSE Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Assume the trend remains the same until proven otherwise. The trend is up at this stage, so corrections present an opportunity to join the trend.

FTSE Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

While the longer term trend looks clear, the shorter term trend is not so clear. This can often be the case at the end of corrections within a larger trend.

Divergence with price and RSI, and Stochastics, indicates weakness at highs. This indicates caution for long positions. There is a level of risk here that is not small.

ELLIOTT WAVE ANALYSIS

FTSE Chart Monthly 2017
Click chart to enlarge.

The normal range for cycle wave b is from 1 to 1.38 the length of cycle wave a. The structure of cycle wave b is close to completion. If cycle wave b reaches twice the length of cycle wave a, the wave count should be discarded based upon an extremely low probability. That point is above 10,624.

FTSE Chart Weekly 2017
Click chart to enlarge.

The weekly chart shows all of intermediate waves (A)-(B)-(C). The structure is an incomplete zigzag. The daily chart below shows all of minor wave 5 within intermediate wave (C).

FTSE Chart Daily 2017
Click chart to enlarge.

Minor wave 5 is unfolding as an impulse and its structure is incomplete. Within minor wave 5, minute wave v may be extending. There is no Fibonacci ratio between minute waves i and iii, so it is more likely that minute wave v will exhibit a Fibonacci ratio to either of minute waves i or iii.

Within the middle of the third wave, micro wave 2 may not move beyond the start of micro wave 1 below 7,263.62. However, the probability of this wave count would substantially reduce if the green channel is breached before this price point is passed.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

This analysis is published @ 01:25 a.m. EST.

Trading Room – 22nd March, 2017

Today’s Trading Room looks at Copper only.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper (Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

The first movement downwards from the high on the 13th of February to the low of the 23rd of February was choppy and overlapping and came on overall declining volume. The market fell of its own weight.

The bounce up to the 1st of March came with some increase in volume. The volume profile looks slightly bullish up to this point, but not strongly.

The fall to the last low on the 9th of March came with increasing volume. This looks clearly bearish.

The next bounce to the high of the 20th of March came with clearly declining volume. This looks like a counter trend movement within a new downwards trend.

ADX has not yet indicated a downwards trend. It is below 15 although it is rising slightly today and the -DX line is above the +DX line.

Contracting Bollinger Bands and declining ATR suggest the market is not yet trending.

The most bearish part of this chart is the recent volume profile. Other indicators suggest caution for short positions.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

Copper may be in the very early stages of a new downwards trend. The green trend line goes back to August 2011 and has recently provided resistance. After price breached the lower edge of the lilac line, it then turned up to find resistance at that line for a typical throwback.

The gold channel is a base channel about minor waves 1 and 2. The upper edge has provided resistance for another second wave correction. The lower edge may now be providing some support. If this Elliott wave count is correct, then Copper should break below support at the lower edge of this channel. It may then turn upwards for a test of resistance before moving down and away.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

This analysis is published @ 02:07 a.m. EST.

Trading Room – 20th March, 2017

Today’s Trading Room looks at US Oil only.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

US Oil is in a clear downwards trend that is not yet extreme. There will be corrections along the way; price does not move in a straight line. Corrections within a trend present an opportunity to join the trend. The challenge is to find when the correction is over.

Price was previously range bound for a long period of time with support about 51.22 to 50.70. On the 8th of March price broke below support on a strong downwards day with strong volume. This was a classic downwards breakout.

It looks now like Oil is in a small correction, curving up to find resistance at prior support about 50.70.

ELLIOTT WAVE ANALYSIS

US Oil Chart Daily 2017
Click chart to enlarge.

A larger flat correction may be unfolding for a fourth wave (EWG members should refer to the US Oil monthly chart for the bigger picture here). Within a flat correction, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 28.61.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

TRADING ROOM SUMMARY TABLES

OPEN POSITIONS

Trading Room Open Positions 2017
Click table to enlarge.

CLOSED POSITIONS

Trading Room Closed Positions March 2017
Click table to enlarge.

RECOMMENDATIONS

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

This analysis is published @ 02:16 a.m. EST.

Trading Room – 13th March, 2017

Today’s Trading Room looks at Copper, US Oil, NGas, USD Index, EURBGP and USDJPY.

To learn what the Trading Room is about see first Trading Room analysis here.

Trading Room will focus on classic technical analysis. Elliott wave analysis will be for support and for targets / invalidation points.

Copper

TECHNICAL ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

Volume supports downwards movement. Copper has broken below support and is now trending down.

Lighter volume for the last upwards session is slightly bearish, as is the long upper wick. On Balance Volume is at resistance.

Two concerns: Price may yet move higher before it turns back down and ATR is still declining.

ELLIOTT WAVE ANALYSIS

Copper Chart Daily 2017
Click chart to enlarge.

The invalidation point is not too far away. A small fourth wave correction may be complete.

The next wave down may exhibit some increase in momentum as it’s a fifth wave for a commodity.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

US Oil (WTI Crude – Spot)

TECHNICAL ANALYSIS

USOil Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

RSI and Stochastics can remain extreme for reasonable periods of time when US Oil trends. Oversold conditions for these two indicators does not necessarily mean a low must be in place.

Very strong volume over the last three days supports downwards movement.

Sometimes after a breakout price curves back to retest prior support or resistance. It is possible here that US Oil may turn up for a test of resistance about 50.70. However, this does not always happen.

HOURLY CHART

USOil Chart Hourly 2017
Click chart to enlarge.

While price remains within this channel expect it to continue downwards. If the channel is breached, then a larger bounce may be underway.

ELLIOTT WAVE ANALYSIS

USOil Chart Daily 2017
Click chart to enlarge.

A larger flat correction may be unfolding for a fourth wave (EWG members should refer to the US Oil monthly chart for the bigger picture here). Within a flat correction, intermediate wave (B) must retrace a minimum 0.9 length of intermediate wave (A) at 28.61.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

Natural Gas

TECHNICAL ANALYSIS

NGas Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

It is concerning that the Magee trend line is breached.

The last three daily candlesticks complete stalled pattern. The longer upper wick on the last candlestick is bearish. Declining volume for the last two upwards days is bearish.

On Balance Volume is bullish in that it is making strong new highs with price. There is some bearish divergence as noted.

Overall, it does look like this is a counter trend movement. But there is no indication it is over at this stage, so it may move higher.

ELLIOTT WAVE ANALYSIS

NGas Chart Daily 2017
Click chart to enlarge.

The fourth wave is now very close to first wave price territory. If this portion of the wave count is correct, then there is very little room for NGas to move into. The target expects a long strong extended fifth wave, typical of commodities.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

USD Index

TECHNICAL ANALYSIS

USD Index Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

If there is a resumption of the larger upwards trend, then this next wave up is in its very early stages. In the short term, it looks like USD Index has made a relatively deep correction. Support is about 100.60. If price can break above resistance at 103, then next resistance is about 103.50.

ELLIOTT WAVE ANALYSIS

USD Index Daily 2017
Click chart to enlarge.

The structure of primary wave 5 is still incomplete. If the current correction moves lower, it should find support at the lower edge of the trend channel. If that trend channel is breached, then the wave count would be in doubt.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

EURGBP

TECHNICAL ANALYSIS

EURGBP Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

It looks like EURGBP is currently at resistance and may move into a small consolidation for a few days. This may bring Stochastics down from overbought. Price may find support about 0.8635.

It looks like there is a new upwards trend beginning.

ELLIOTT WAVE ANALYSIS

EURGBP Daily 2017
Click chart to enlarge.

The upwards movement should unfold as a three wave structure, so there should be downwards movement for minor wave B within it. If the target is wrong, it may be too low.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

USDJPY

TECHNICAL ANALYSIS

USDJPY Chart Daily 2017
Click chart to enlarge. Chart courtesy of StockCharts.com.

This pair has proven tricky to find an entry. It is currently in a consolidation with resistance about 115.55 and support about 111.55.

The short term Fibonacci 13 day moving average has just crossed above the mid term Fibonacci 55 day moving average giving a bullish crossover.

RSI is not extreme. Stochastics is extreme, but this may remain extreme for long periods of time when this market trends.

VOLUME ANALYSIS

USDJPY Chart Daily 2017
Click chart to enlarge.

Volume for the last three upwards days showed an increase to support the rise in price. The long upper wick on the last daily candlestick is bearish.

On Balance Volume is squeezed. A break above the purple resistance line would be a reasonable bullish signal. A break below the yellow support line would be a weak bearish signal.

ELLIOTT WAVE ANALYSIS

USDJPY Daily 2017
Click chart to enlarge.

The structure of cycle wave III is still incomplete. The fifth wave up needs to unfold.

Trading advice for members only: [Content protected for Elliott Wave Gold members only. To subscribe click here.]

DISCLAIMER

As always, it is essential that anyone using this analysis for trading advice manages risk carefully. Follow my two Golden Rules:

1. Always use a stop.

2. Never invest more than 1-5% of equity on any one trade.

Trading is about probabilities, not certainties. Failure to follow my two Golden Rules of trading indicates failure to manage risk.

Accept that this analysis may be wrong. It is impossible for any analyst to predict with certainty what a market will do next.

TRADING ROOM SUMMARY TABLE

New to Trading Room is a simplified table to summarise Trading Room. (Thanks to our member Dreamer for the idea.)

Subsequent posts will add a separate table for Open Positions and when applicable a third table for Closed Positions.

[Content protected for Elliott Wave Gold members only. To subscribe click here.]

 

This analysis is published @ 03:20 a.m. EST.