Daily-Elliott-Wave-Analysis-01-25-17- DOW posts new all time high, and GOLD declines, surprise to some, not to us!

EURUSD

Current wave 3 down – below parity.

30 min

4 Hours

Daily

My Bias: short in wave 3 blue.
Wave Structure: downward impulse wave 1, 2 blue
Short term wave count: lower in wave 3 green
Long term wave count: lower in wave 3 blue
Important risk events: EUR: Spanish Unemployment Rate, German Buba President Weidmann Speaks. USD: Unemployment Claims, New Home Sales.

Evening everyone.

EURUSD has put in a basically flat day today.
There is an argument to be made that that tuesdays high at 1.0775 is the final high in wave (ii) green.
The price has traced out a possible five wave structure to the downside off that high.

I have labelled the chart with a complete 1,2 structure to the downside, so the current wave count is very bearish.
A break of 1.0587, the previous fourth wave will add weight to the bearish outlook.

The real story is in the 4hr chart, with the RSI continuing that downward trajectory and approaching a cross to the downside soon.
The momentum in this painful corrective rally has died and the signs are all pointing to a turn down soon.

GBPUSD

Wave 2 red, downtrend resumed.

30 min

4 Hours

Daily

My Bias: short below parity.
Wave Structure:  continuing impulsive structure to the downside in wave (5)
Short term wave count: Downside from 1.2385 to 1.1900
Long term wave count: decline in wave (5) blue, below parity
Important risk events: GBP: Prelim GDP q/q, Eurogroup Meetings. USD: Unemployment Claims, New Home Sales.

Cable continued its fumble to the upside today!
Both EURUSD and CABLE are rallying against the larger trend and that larger trend is weighing on the price right now.

Todays rally has possibly completed wave ‘v’ pink. If so we should start to se the price falter from here.
The 4hr technicals look to be topping out today, with the RSI staying under that downward sloping trendline.
The market is overbought at this point From her I am watching for a lower high and an elliott wave sell signal.

USDJPY

LONG

30 min

4 Hours

Daily

My Bias: Neutral
Wave Structure: rally in wave [C]
Short term wave count: wave [v] grey
Long term wave count: wave [C] is underway, upside to above 136.00
Important risk events: JPY: Tokyo Core CPI y/y. USD: Unemployment Claims, New Home Sales.

USDJPY had pretty flat day also, which I think could be within the context of a minor second wave in wave c brown.
This interpretation will be confirmed if we get a rally in wave 3 red off todays lows.

The target for wave ‘c’ brown is at about 115.60 in a possible flat correction in wave (b).
In that case, wave 2 red at 113.03 should not be broken and the price should continue higher for the coming days.

DOW JONES INDUSTRIALS

Topping in wave (5)

30 min

4 Hours

Daily

My Bias: Long towards 20,500
Wave Structure: Impulsive 5 wave structure, possibly topping in an all time high.
Short term wave count: Upside from 17,066 wave 4 blue
Long term wave count: Topping in wave (5)
Important risk events: USD: Unemployment Claims, New Home Sales.

Todays rally was expected, the rest of the world may have been surprised but not us Elliott wavers!
From Mondays analysis I had expected a rally all week which would break the all time high.

The market has now rallied over 300 points since Mondays analysis was published, I hope some of you caught that rally.

From here I expect the rally to continue in an ongoing five wave structure in grey, which should eventually bring the market above 20500.
The most optimistic outlook is for a rally above 21000 where wave [v] green will match the magnitude of wave [i] green.
For now i think we should see a slight correction in wav iv purple, and then another rally to complete wave (i) grey.

GOLD

Current wave [B] – Long to 1550

30 min

4 Hours

Daily

My Bias: Long towards 1550
Wave Structure: ZigZag correction to the upside.
Short term wave count: Upside from 1120~, target 1500
Long term wave count: Topping in wave (B) at 1500
Important risk events: USD: Unemployment Claims, New Home Sales.

GOLD continued its decline in a possible expanded flat wave (ii) blue.
Wave ‘c’ is not complete yet, 1187 seems more likely target.
The decline looks like it needs one more drop in wave 5 purple.

The alternate count is circled in red, which views the correction as complete in a running flat.
Should the decline continue deeper into the 1150 region, I will switch the wave labelling to the 4hr chart version.
This is a little less bullish over all but still has a target in the region of 1500.
For tomorrow watch the 1187 level for a bottom.

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