Category Archives: Public Analysis

USD Index: Elliott Wave and Technical Analysis | Charts – 15th November, 2018

November 15, 2018Public Analysis, USD IndexLara

An upwards breakout on the 12th of November was today proven false as price is back below resistance.

Summary: The bearish Elliott wave count expects a new high to 98.09 or above and then a trend change. The bullish Elliott wave count expects a trend change now.

The bottom line here is that there is an upwards trend in place since the low on the 21st of September. Only a new swing low below 95.48 would signal a trend change.

New updates to this analysis are in bold.

BEARISH ELLIOTT WAVE ANALYSIS

QUARTERLY CHART

Click chart to enlarge.

The wave count begins at 0.

A huge double zigzag may be continuing lower.

MONTHLY CHART

Click chart to enlarge.

Downwards movement from the high in January 2017 cannot be a fourth wave correction within an ongoing impulse higher because a new low below 89.62 would be back in first wave price territory.

That indicates the last big wave up may be a completed three, and for that reason this is my main wave count.

WEEKLY CHART

Click chart to enlarge.

Cycle wave I downwards fits very well as a five wave impulse. This may be reasonably expected to be followed by a three wave structure upwards.

For the USD Index, historically the first second wave correction within a new trend is usually extremely deep, about 0.80 to 0.90 of the first wave it corrects. It would be typical here to see Cycle wave II reach to 0.80 or deeper of cycle wave I.

Cycle wave II may be unfolding as a zigzag, which is the most common type of corrective structure.

Primary wave A may now be a completed five wave impulse.

Primary wave B may be complete as labelled on this weekly chart. However, it may also be labelled as incomplete as per the labelling for this movement on the alternate weekly chart below.

If primary wave B continues, then it may be as a flat, combination, double zigzag or triangle. Primary wave B may not move beyond the start of primary wave A below 88.25.

Cycle wave II may not move beyond the start of cycle wave I above 103.82.

Draw a channel about cycle wave II as shown. This is Elliott’s technique for a correction. Primary wave C may end either mid way within the channel or about the upper edge.

DAILY CHART

Click chart to enlarge.

If primary wave B is complete, then primary wave C should have begun. Primary wave B will fit as a brief and shallow zigzag. This is entirely possible; B waves exhibit the greatest variety in Elliott wave structure and price behaviour.

Primary wave C may be unfolding as an ending expanding diagonal. Because the diagonal is expanding intermediate wave (5) must be longer than intermediate wave (3) and must end beyond 98.09, which is where it would reach equality in length with intermediate wave (3).

Within an ending diagonal, all sub-waves must subdivide as zigzags. Within the final zigzag of intermediate wave (5), minor wave B may not move beyond the start of minor wave A below 95.67. If price breaks below 95.67 without first moving higher to 98.09 or above, then my analysis of cycle wave II is wrong; cycle wave II may have ended.

It is also possible to move the degree of labelling within primary wave B all down one degree and see it as an incomplete flat, combination or triangle.

BULLISH ELLIOTT WAVE ANALYSIS

QUARTERLY CHART

Click chart to enlarge.

A single zigzag down to the last major low may still be complete.

A new upwards trend may continue. So far there may be two overlapping first and second waves. Primary wave 2 may not move beyond the start of primary wave 1 below 72.69.

Primary wave 2 should find strong support at the lower edge of the teal base channel if it gets down that low.

MONTHLY CHART

Click chart to enlarge.

Primary wave 2 may be a complete zigzag. However, this wave down can also be seen as a five and primary wave 2 may yet continue lower.

WEEKLY CHART

Click chart to enlarge.

This bullish wave count sees the last wave down as a completed zigzag. If this is correct, then within primary wave 3 no second wave correction may move beyond its start below 88.25.

DAILY CHART

Click chart to enlarge.

Intermediate wave (2) may be an incomplete expanded flat. The first wave down within it is labelled minor wave A, which is a complete zigzag. Minor wave B may now be complete at 1.22 the length of minor wave A, which is within the most common range for B waves of flats of 1 to 1.38 times the length of their A waves.

Minor wave C may move below the end of minor wave A at 93.81 to avoid a truncation. A target is calculated now for minor wave C to reach the most common Fibonacci ratio to minor wave A within an expanded flat correction.

TECHNICAL ANALYSIS

MONTHLY CHART

Click chart to enlarge. Chart courtesy of StockCharts.com.

October was a strong bullish month. This may be reasonably expected to be followed by more upwards movement. This supports the main Elliott wave count.

DAILY CHART

Click chart to enlarge. Chart courtesy of StockCharts.com.

The upwards breakout above resistance at 96.80 on the 12th of November is false as price has now returned back below resistance.

However, since the 21st of September there is a series of higher highs and higher lows, the definition of an upwards trend. Only a new low now below 95.48 would provide a lower low and indicate this upwards trend may be over.

Published @ 03:15 a.m. EST.

USD Index: Elliott Wave and Technical Analysis | Charts – 9th November, 2018

November 9, 2018Public Analysis, USD IndexLara

A pullback or a time consuming consolidation was expected after last analysis on the 26th of August. Price continued lower until the 20th of September and from there has bounced up strongly.

This analysis will attempt to determine if the bounce is just an upwards swing within an ongoing consolidation or the start of a new upwards trend.

Summary: Price is within a small consolidation. It looks like an upwards breakout may be more likely than downwards. A close above resistance about 96.80 on an upwards day with support from volume would be an upwards breakout. If that happens, then look for the upwards move to end about 97.19 to 97.87.

New updates to this analysis are in bold.

BEARISH ELLIOTT WAVE ANALYSIS

QUARTERLY CHART

Click chart to enlarge.

The wave count begins at 0.

A huge double zigzag may be continuing lower.

MONTHLY CHART

Click chart to enlarge.

Downwards movement from the high in January 2017 cannot be a fourth wave correction within an ongoing impulse higher because a new low below 89.62 would be back in first wave price territory.

That indicates the last big wave up may be a completed three, and for that reason this is my main wave count.

WEEKLY CHART

Click chart to enlarge.

Cycle wave I downwards fits very well as a five wave impulse. This may be reasonably expected to be followed by a three wave structure upwards.

Cycle wave II may be unfolding as a zigzag, which is the most common type of corrective structure.

Primary wave A may now be a completed five wave impulse.

Primary wave B may be complete as labelled on this weekly chart. However, it may also be labelled as incomplete as per the labelling for this movement on the alternate weekly chart below.

If primary wave B continues, then it may be as a flat, combination, double zigzag or triangle. Primary wave B may not move beyond the start of primary wave A below 88.25.

Cycle wave II may not move beyond the start of cycle wave I above 103.82.

Draw a channel about cycle wave II as shown. This is Elliott’s technique for a correction. Primary wave C may end either mid way within the channel or about the upper edge.

DAILY CHART

Click chart to enlarge.

Within primary wave C, intermediate waves (1) and (2) may now be complete. Intermediate wave (3) may have begun.

Within intermediate wave (3), no second wave correction may move beyond the start of its first wave below 94.78.

Intermediate wave (3) may now be ready to exhibit an increase in upwards momentum, as the middle strongest portion of it passes. This may have the strength to effect an upwards breakout from the current consolidation. If price closes above resistance about 97 on an upwards day with support from volume, then have confidence that a third wave up at two degrees is underway.

It is also possible to move the degree of labelling within primary wave B all down one degree and see it as an incomplete flat, combination or triangle.

BULLISH ELLIOTT WAVE ANALYSIS

QUARTERLY CHART

Click chart to enlarge.

A single zigzag down to the last major low may still be complete.

A new upwards trend may continue. So far there may be two overlapping first and second waves. Primary wave 2 may not move beyond the start of primary wave 1 below 72.69.

Primary wave 2 should find strong support at the lower edge of the teal base channel if it gets down that low.

MONTHLY CHART

Click chart to enlarge.

Primary wave 2 may be a complete zigzag. However, this wave down can also be seen as a five and primary wave 2 may yet continue lower.

WEEKLY CHART

Click chart to enlarge.

This bullish wave count sees the last wave down as a completed zigzag. If this is correct, then within primary wave 3 no second wave correction may move beyond its start below 88.25.

Intermediate wave (2) may be an incomplete flat, double zigzag or combination. The first wave down within it is labelled minor wave A; this is a complete zigzag. Minor wave B may now be complete or almost complete, but it may continue higher to make a new high above the start of minor wave A at 96.98 as in an expanded flat.

When minor wave B is complete, then minor wave C may move below the end of minor wave A at 93.81 to avoid a truncation.

TECHNICAL ANALYSIS

MONTHLY CHART

Click chart to enlarge. Chart courtesy of StockCharts.com.

October was a strong bullish month. This may be reasonably expected to be followed by more upwards movement. This supports the main Elliott wave count.

DAILY CHART

Click chart to enlarge. Chart courtesy of StockCharts.com.

There is a small consolidation with support about 95.30 and resistance about 96.80. A break above resistance would be an upwards breakout. For confidence look for any upwards breakout to have support from volume.

The strong Bullish Engulfing Candlestick pattern also completes a Morning Doji Star. This is very bullish and supports the main Elliott wave count.

Unfortunately, StockCharts do not provide volume data for currencies; no volume analysis is made for the USD Index. This does reduce the accuracy and depth of this analysis.

A note about the correlation co-efficient: Any two sets of data which have a correlation co-efficient that spends time in the shaded area between +0.5 to -0.5 are considered to not have a reliable correlation. Currently, the correlation co-efficient between Gold and the USD Index is very weakly negative at -0.15. This weak negative correlation may be only due to chance and not because there exists a relationship between the two sets of data.

Published @ 03:00 a.m. EST.

XOP-SPDR S&P Oil & Gas Explor & Prodtn ETF: Elliott Wave and Technical Analysis | Charts – 31st October, 2018

October 31, 2018Public Analysis, XOPLara

ELLIOTT WAVE ANALYSIS

MONTHLY CHART

Click chart to enlarge.

A very large expanded flat may have ended at the last low. This is labelled cycle wave II.

Within cycle wave II, primary wave B is within the normal range of up to 1.38 times the length of primary wave A. Primary wave C moves below the end of primary wave A avoiding a truncation and a rare running flat.

If this part of the wave count is correctly labelled, then the bear market may be over for XOP. A three wave structure moving lower indicates the larger trend may be upwards.

The alternate idea would be that this expanded flat may be only wave W of a double flat or combination; the correction would continue sideways for a few more years.

WEEKLY CHART

Click chart to enlarge.

From the end of cycle wave II, a five up may have completed. This is labelled primary wave 1.

Primary wave 2 may be an incomplete regular flat correction. Regular flats usually have C waves that end slightly beyond the end of their A waves.

Intermediate wave (C) must subdivide as a five wave structure. So far minor waves 1 and 2 may be complete. Minor wave 3 may only subdivide as an impulse. Strong downwards movement last week fits expectations for a third wave.

Primary wave 2 may not move beyond the start of primary wave 1 below 22.06.

DAILY CHART

Click chart to enlarge.

Minor wave 3 exhibits strength. It looks like a third wave.

Within minor wave 3, minute wave i and ii may be complete.

Within minute wave iii, minuette waves (i), (ii) and now (iii) may be complete. Minuette wave (iv) may not move into minuette wave (i) price territory above 40.26.

Overall, this wave count expects more downwards movement to at least slightly below 28.96. This target may be met in another few months.

Along the way down, another consolidation to last about one to two months for minor wave 4 may be expected. When it arrives, minor wave 4 may not move into minor wave 1 price territory.

Draw an acceleration channel about downwards movement. Draw the first trend line from the low labelled minor wave 1 to the last low, then place a parallel copy up on the high labelled minor wave 2. As price keeps moving lower, keep redrawing the channel. When minor wave 3 is complete, then the upper edge of this channel may provide resistance for minor wave 4.

TECHNICAL ANALYSIS

Click chart to enlarge.

Price consolidated, with support about 39.65 and resistance about 45.00, from the 7th of May 2018 to the 22nd of October 2018.

Price broke out from the consolidation zone on the 22nd of October on a strong downwards day. The following day gapped lower on another strong downwards day with support from volume, creating a breakaway gap. This looks like a classic downwards breakout.

If price bounces up here to test resistance, then expect strong resistance at the breakaway gap at 39.10.

Currently RSI is oversold and there is a bullish candlestick pattern. Expect a small bounce or consolidation here.

The target is about 32.99.

Published @ 02:37 a.m. EST.

—
Careful risk management protects your trading account(s).
Follow my two Golden Rules:

1. Always trade with stops.

2. Risk only 1-5% of equity on any one trade.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 17th October, 2018

October 17, 2018Bitcoin, Public AnalysisLara

Bitcoin continues to move sideways and remains range bound.

Summary: A clear breach of a support line, which has seen all price action above it until this point, is a strong indication that Bitcoin is bearish. Now that a backtest about the support line is complete, price may be expected to continue to move downwards from this line.

At this time, Bitcoin may be in the early stages of a third wave down at six degrees.

A new alternate Elliott wave count is published today which allows for a large bounce here before a continuation of downwards movement to new lows.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

I am unable to find reasonable Fibonacci ratios within this wave count. It appears that Bitcoin may not exhibit Fibonacci ratios very often between its waves, so this makes target calculation impossible. Classic technical analysis was used to identify a high in place on the 23rd of December, 2017.

What is very clear from this chart is that Bitcoin is a classic bubble. This looks like an even larger bubble than the Tulip Mania. The only thing about which I am certain is that this bubble will pop and Bitcoin will collapse.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Click chart to enlarge.

Bitcoin tends to behave like an extreme commodity: price moves upwards for about 2 – 4 weeks in a near vertical movement at the end of its rises. Following this vertical movement the resulting downwards movement is very deep (in percentage terms) and often very quick.

The next rise begins slowly with basing action over weeks or months, and then as the rise nears its end another vertical movement completes it. Also, there are volume spikes just before or at the end, which is another feature typical of commodity like behaviour.

This has happened now several times. The most notable instances are the rise up to the week ending 24th November, 2013, and the week ending 5th June, 2011. The following sharp drops were 94% and 93% respectively.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be beginning at six degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

The best fit channel has only weak technical significance and is now breached.

The Forever trend line is not perfectly showing where price found support and has then found resistance for a typical back test. However, it is about where price found support and resistance. The breach and back test are highly significant.

I have searched to find if a five down could be seen as complete. At this time, I cannot yet see either a complete impulse or a leading diagonal.

SECOND ELLIOTT WAVE COUNT

WEEKLY

Click chart to enlarge.

It is also possible that Bitcoin may move lower as a flat correction, double combination or a double zigzag.

Within a flat correction, cycle wave a may have completed as a zigzag. Cycle wave b would need to move higher to retrace a minimum 0.9 length of cycle wave a at 18,480. Cycle wave b would need to subdivide as a corrective structure, most likely a zigzag. Cycle wave b within a flat correction may make a new price extreme beyond the start of cycle wave a.

Within a double zigzag, cycle wave w may be the first zigzag complete. Cycle wave x would have no minimum nor maximum required length to cycle wave w; it only needs to complete as a corrective structure, which would most likely be a zigzag. X waves within double zigzags are usually shallow, so that the whole structure has a strong slope.

Within a double combination, cycle wave w may be the first complete structure as a zigzag. Cycle wave x would have no minimum nor maximum required length to cycle wave w; it only needs to complete as a corrective structure, which would most likely be a zigzag. X waves within combinations are usually deep, so that the whole structure has a sideways look. Cycle wave x within a combination may make a new price extreme beyond the start of cycle wave w.

A second wave may not subdivide as a triangle with its sole corrective structure, so a triangle for this correction is not considered.

DAILY

Click chart to enlarge.

The daily chart focusses on the whole of cycle wave b or x so far.

Cycle wave b or x may be unfolding as a regular flat correction, and within it primary wave A fits as a three and primary wave B also fits as a corrective structure. Primary wave B effects a net 0.965 re-tracement of primary wave A at its end. This meets the minimum requirement of 0.9 for B waves within flat corrections.

A target is calculated for primary wave C to end. However, because Bitcoin does not exhibit reliable Fibonacci ratios this target is a rough guideline only. A better guide may be resistance about the orange forever trend line.

TECHNICAL ANALYSIS

Click chart to enlarge.

Volume is declining (at higher time frames); this market is falling mostly of its own weight. However, looking more closely, daily volume is stronger for downwards days than for upwards days.

The following can be noted when looking back at Bitcoin’s behaviour during its previous strong falls in price:

The 94% fall in price from June to November 2011 was characterised by:

– Three clearly separate instances of RSI reaching oversold on the daily chart, separated by bounces.

– ADX did not remain very extreme for very long at all on the daily chart.

– On Balance Volume exhibited weak single bullish divergence at the low.

The 93% fall in price from November 2013 to February 2014 was characterised by:

– RSI reached oversold and remained deeply oversold for three weeks; at the low there was only single weak bullish divergence with price.

– ADX remained very extreme for the last seven sessions to the low.

– At the low, On Balance Volume did not exhibit bullish divergence with price; it remained bearish and then exhibited further bearishness after the low as it continued to decline as price began to rise.

For the current fall in price, the current Elliott wave count expects the fall to be larger in terms of duration than the previous two noted here, and at least equivalent in terms of price movement in that a fall of over 90% is expected now. Currently, ADX is not yet extreme and RSI is not yet oversold. There is plenty of room for this downwards trend in Bitcoin to continue. So far at the lowest low from the all time high Bitcoin has only retraced 0.70. While this is deep, its corrections are usually deeper than this.

On Balance Volume and price remain range bound. Price has resistance about 7,775 and support about 5,890. Watch both closely to see a breakout.

Published @ 03:21 p.m. EST.

GDX: Elliott Wave Analysis | Charts – 25th September, 2018

September 25, 2018GDX, Public AnalysisLara

Last Elliott wave analysis of GDX was almost a year ago.

Summary: The situation is now somewhat clearer after a strong breakout from a very long consolidation. Only one Elliott wave count is now published for GDX.

It is my opinion based upon experience that this market does not have sufficient volume for reliable Elliott wave analysis, which is why I do not provide it on a regular basis. Classic technical analysis would be a better approach for this market, which is why I provide it daily to members.

For members who are interested in an Elliott wave count of GDX, I am providing it here. This analysis should be used only as a general guide. For a more reliable guide see the daily GDX technical analysis provided at the end of each Gold analysis.

MONTHLY CHART

Click chart to enlarge.

From September 2011 to January 2016 this downwards wave fits best as a five wave impulse. The downwards five is labelled Super Cycle wave (a). If this downwards wave is a five, then it should be followed by a three up and then another five down.

The following three up labelled Super Cycle wave (b) would most likely be incomplete, and it would likely last longer to have better proportion to Super Cycle wave (a).

Super Cycle wave (b) would most likely subdivide as a zigzag, although it may also be a flat, triangle or combination. None of the more than 23 possible corrective structures can be eliminated because it is not possible to have full confidence on the structure of cycle wave a within it.

If cycle wave a is a five wave structure (which it fits best as), then Super Cycle wave (b) would be indicated as unfolding as a zigzag. Within the zigzag, cycle wave b may not move beyond the start of cycle wave a below 12.40.

If cycle wave a is a three wave structure (a zigzag), then Super Cycle wave (b) may be any one of a flat, triangle or combination. Within an expanded flat, running triangle or combination, wave b (or x) may move beyond the start of wave a (or w) below 12.40.

The weekly chart below looks at the structure of Super Cycle wave (b) so far.

WEEKLY CHART

Click chart to enlarge.

If cycle wave a is an impulse, then cycle wave b may not move beyond its start below 12.40.

If price makes a new low below 12.40, then cycle wave a would need to be relabelled as a zigzag.

Cycle wave b looks best as an incomplete zigzag. The last strong downwards wave looks like a third wave, which is labelled intermediate wave (3).

The structure of primary wave B is very difficult to analyse. Although it looks like a triangle, and a triangle will fit, a triangle looks wrong. The trend lines would either not converge or would not be adhered to.

After considering several different possible structures the only one which has a good fit is a very rare triple combination.

Primary wave C must complete as a five wave impulse. So far intermediate waves (1), (2) and (3) may now be complete. Intermediate wave (4) may not move into intermediate wave (2) price territory above 20.83.

DAILY CHART

Click chart to enlarge.

Intermediate wave (4) would most likely subdivide as a zigzag or zigzag multiple to exhibit alternation with the combination of intermediate wave (2).

Intermediate wave (4) may end close to the 0.382 Fibonacci ratio to exhibit alternation in depth with intermediate wave (2).

So far minor wave A looks like it may be a complete five wave impulse. If that piece of this wave count is correct, then minor wave B may not move beyond the start of minor wave A below 17.28.

Minor wave B may move sideways for several sessions, or it could be a quick sharp pullback over in just a few days. There are multiple structural options for minor wave B; B waves exhibit the greatest variety in structure and price behaviour.

When minor wave B is a complete corrective structure, then minor wave C would be most likely to make at least a slight new high above the end of minor wave A at 19.11 to avoid a truncation. Minor wave C may end only slightly above the end of minor wave A at 19.25 to see intermediate wave (4) end about the 0.382 Fibonacci ratio.

Published @ 04:36 a.m. EST.

BTCUSD: Elliott Wave and Technical Analysis | Charts – 19th September, 2018

September 19, 2018Bitcoin, Public AnalysisLara

Bitcoin continues to move mostly sideways, with a slight downwards bias.

At this time, Bitcoin may be in the early stages of a third wave down at four degrees.

The data used for this analysis now comes from Yahoo Finance BTC-USD.

Updates to this analysis are in bold.

Last analysis may be found here.

FIRST ELLIOTT WAVE COUNT

MONTHLY

Click chart to enlarge.

It is possible to see a completed five wave impulse upwards for Bitcoin.

Now that the Forever trend line is breached some confidence may be had that Bitcoin may be crashing.

WEEKLY

Click chart to enlarge.

If this current drop continues like the last two examples, then a reasonable target may be about $1,390.94 or below.

DAILY

Click chart to enlarge.

If Bitcoin is in the early stages of a huge crash, then a five down structure should develop at the weekly chart level. This would still be incomplete.

A third wave down may now be beginning at five degrees. Bitcoin may be still winding up for a spectacular plummet in price. The strongest fall may come towards the end of any one or more of these third waves as Bitcoin exhibits commodity like behaviour. Commodities tend to have their strongest portion of impulses in the fifth waves.

The best fit channel has only weak technical significance.

My alternate bullish wave count was discarded because the Forever trend line is properly breached and now has a successful backtest.

I have again searched to find if a five down could be seen as complete. At this time, I cannot yet see either a complete impulse or a leading diagonal.

TECHNICAL ANALYSIS

Click chart to enlarge.