Daily-Elliott-wave-analysis-12-23-16- low risk opportunities, AND, Wishing you all a joyous and peaceful Christmas.


Current wave 3 down – below parity.

30 min

4 Hours


My Bias: short in wave 3 blue.
Wave Structure: downward impulse wave 1, 2 blue
Short term wave count: lower in wave 3 blue
Long term wave count: lower in wave 3 blue
Important risk events:  EUR: N/A. USD: CB Consumer Confidence

Good evening to you all,

Another quiet day today, tis the season for it!

I have shown another possible wave count, circled in red, on the short term chart which fits the prce action as well as the operating wave count.
The outcome of both wave counts is the exact same,
A large decline is on the cards here, and we are on the cusp of it.

The low volume of the next week mat put a hold on any serious declines,
But, we should be vigilant as a shorting opportunity may well present itself in this period.

For both wave counts the critical low lies at 1.0353.


Current wave (4) – Long to 1.3000

30 min

4 Hours


My Bias: Long towards 1.2900
Wave Structure: Zigzag upside correction
Short term wave count: Upside from 1.1800 – 1.2080, Upper target 1.3400
Long term wave count: Rally in wave (4) blue, Upper target 1.3400
Important risk events: GBP: N/A. USD: CB Consumer Confidence

The slight decline in cable today does not reveal anything new here.
If the price s in fact tracing out an expanded flat wave [ii] green, then we would expect wave (c) brown to drop below wave (a) brown.
So the current action is in line with the form of an expanded flat.

The real test for cable will arise next week,
The minor resistance at 1.2511, should not cause much trouble for the bullish wave count.
If it does stall the market, then I will look at switching to the alternative wave count.


Current wave [iv] – Short to 108.00

30 min

4 Hours


My Bias: short to 106.00
Wave Structure: rally in wave [C]
Short term wave count: wave [iii] grey
Long term wave count: wave [C] is underway, upside to above 136.00
Important risk events: JPY: Household Spending y/y, Tokyo Core CPI y/y. N/A. USD: CB Consumer Confidence

USDJPY is still showing the same rally potential that I spoke of last night.
I have labelled the contracting triangle as complete
So there is a good chance we will see the rally form from here.

The wave d high at 117.88 is the confirmation point for the rally in wave v brown.
and todays low should hold for this short term pattern to remain valid.
The first target for completion of wave v brown is at 11950.
Lets see if todays low holds first.
There may even be a better opportunity early next week.


Current wave [5] – Long to 21000

30 min

4 Hours


My Bias: Long towards 21,000
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: CB Consumer Confidence

The DOW went essentially nowhere today.
With the formation of a very slight lower high this evening.

The critical low for the bullish interpretation is at 19847, the previous wave 4 green low.
If the price falls below this level, it could mean the end of the whole post election rally and we will kick off the new year with a very very steep decline.

The 4hr RSI is looking pretty bearish at this point with a centreline cross to the downside coming our way.
Momentum traders will take the as a serious sell signal.

At the minimum I am expecting a decline into the 19000 level in a possible wave [iv] green.
But the viability of the alternative wave count shown on the daily chart, just keeps rising with every extra day of bullish overexhuberance!

We will know soon enough which short term wave count wins over.
Needless to say, I would not like to be president when the next bear market kicks off!


Current wave [B] – Long to 1550

30 min

4 Hours


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

The Gold wave count has not change after the day, I think we can expect that final drop below 1120 to complete 5 waves down in blue.

Support comes in at 1103, at the 262% extension of wave 1 blue.
this should complete wave v brown and the larger corrective structure.
Bearishness is now at capitulation levels, whom ever wanted to sell, has now sold, and now we wait for the inevitable rally and the beginning of wave C.

The new year is looking bright for the Yellow metal.

The market is closed on Monday, St Stephan’s day, So I will be back as usual on Tuesday.
Until then,

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