Daily-Elliott-wave-analysis-12-28-16- First signs the DOW rally is breaking.

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 blue
Long term wave count: lower in wave 3 blue
Important risk events:  EUR: M3 Money Supply y/y. USD: Unemployment Claims, Crude Oil Inventories.

Hi everyone, The markets came back to life today and offered some clarity on the price patterns.

I have switched EURUSD to the alternate wave count today.
The meandering action of the last few days looks more like an internal ‘b’ wave.
This wave count views the current action as an ongoing wave (ii) green with the critical low remaining at 1.0350.

We should see a short rally to about 1.0500 to complete a possible flat correction wave (ii) green.
at that point it will be eyes on for a shorting opportunity.
Todays low must hold and the minimum target for wave ‘c’ brown is at above 1.0480.

GBPUSD

Neutral

30 min

4 Hours

Daily

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: Unemployment Claims, Crude Oil Inventories.

The further decline in Cable today brought the price closer to that invalidation line at 1.2079.
The decline does not show any signs of turning just yet.

The alternate wave count is shown on the 4hr chart and views wave (4) blue as complete already.
Either way, there should be a relief rally coming our way soon.

The 262% fib extension of wave ‘i’ red projects a low at 1.2190, the price might find support at that level.

USDJPY

Current wave [iv] – Short to 108.00

30 min

4 Hours

Daily

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: N/A. USD: Unemployment Claims, Crude Oil Inventories.

USDJPY broke out of the triangle formation to the downside today.
I am viewing this as a possible correction within the final wave ‘v’ advance.

The invalidation line for this outlook is at 116.14, the wave ‘i’ high.

The price must turn up soon for the short term bullish outlook to remain valid.
Price will touch the lower trendline at 116.78 or so, watch for a turn at that level.

DOW JONES INDUSTRIALS

Neutral

30 min

4 Hours

Daily

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: Unemployment Claims, Crude Oil Inventories.

The DOW came took a good beating today, with a 150 point drop off the overnight highs.
This decline fits with the immediately bearish outlook I had showed yesterday.
I have labelled the decline so far as a downside impulsive move in green.

Wave 3 green should extend, so watch for a corrective rally off nearby levels to offer an attractive shorting opportunity.
If this is a developing bear market, then todays high should not be challenged again.
Todays decline brought an RSI centerline cross on the 4hr chart, a bearish signal.

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 1550
Long term wave count: Topping in wave (B) at 1550
Important risk events: USD: Unemployment Claims, Crude Oil Inventories.

Gold entered a holding pattern today, and has remained off yesterdays 1149 high.
The 1150 low at wave ‘i’ blue is the bearish invalidation line.
If we get an advance through that level, it could signal the bear market is over.

For the moment I am still expecting one last decline in wave 5 blue, to complete a larger structure.
With the minimum target at 1122 and the lower end support at 1103.