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Elliott Wave Analysis of the S&P-500 by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.
I’ve been getting a lot of questions about my count on the US Stock Market, so here is an updated chart, but my target zone for wave 4 burgundy to end hasn’t changed substantially since my May 25 and May 23 posts. Take note: Ben Bernanke starts speaking tomorrow 15 minutes before the market closes.
Elliott Wave Analysis of the EUR/USD Currency Pair by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.
I’m now calling the above my preferred count for the Euro. We’re probably just a day or two away from the MACD divergence I’ve been looking for on this 180 minute chart. Just beware that the US stock market is likely to bounce at any time, and the correlation between the Dollar and equities has been blurred as of late, so any kind of breakout could be quickly retraced before a new downtrend in the Euro can thoroughly establish itself.
Notice how the pink vertical lines, placed at the MACD extremes, are pointing out the “wave 3′s” throughout. This is the sort of thing that I teach in my weekend webinars. Hope to see you in one soon!
Elliott Wave Analysis of the EUR/USD Currency Pair by Sid from ElliottWavePredictions.com. Click on the charts twice to enlarge.
Last week was pretty significant in my opinion, because the US Dollar lost ground at the same time as the US stock market. This could be a game changer if it sticks. These two have been pretty highly (inversely) correlated for quite a while now, and frankly, if the two were to de-correlate, I would have expected the Dollar to continue to strengthen, especially given the impulsive looking move starting the first week of May, while my expectation was (and still is) for the stock market to also strengthen in a wave 5, but only AFTER the current wave 4 burgundy completes. The definite de-coupling last week, along with a rally in the Euro of nearly 700 pips after what looks like a “3″ (on a 4-hour chart) from May 4 thru May 23 has added additional weight to the alternate wave count for the Euro shown above, (also see the May 23 post) which labels the May 4 high as a wave 3 (pink) top, and the aggressive drop that started May 4 as a pink wave 4. Please note once again that the MACD supports this view, because there was NO divergence prior to May 4, which marked the 2011 high point of the MACD on a daily chart.
The 2 hour chart above shows that the Euro aggressively broke upwards out if its channel on Friday, which generally points toward impulsive wave 3 activity, rather than ABC corrective price action. If this up move from May 23 is wave 5 pink, it is possible that it may truncate by ending (after 5 green waves) below the May 4 high, or, if it moves above 1.49389, it can only make a slight new high if the 1-2-1-2 count is to remain valid. The target zone is quite small, and is shown by the blue oval on the daily chart. The internal structure of the waves will be paramount. Despite the precariously small target zone, I’ll be looking for a wave 3 peak in the MACD on a 4-hour chart, and then divergence, as the wave 5 green makes a new high, while the MACD cannot. My current opinion is that the November 11, 2009 high will hold, primarily because of the 5 clear non-overlapping waves to the upside in the US Dollar Index, which occurred starting at 70.70 in March of 2008.
This more bullish alternative for the Euro will be all but invalidated with movement below 1.43060.
Oh, by the way, the spammers started hitting the comments portion of my site in droves, and even though the spam filter caught them, out of safety, I’ve decided to once again turn off the possibility for comments on the site. We can always communicate through the Contact tab. Thanks . .
Elliott Wave Analysis of the EUR/USD Currency Pair by Sid from ElliottWavePredictions.com. Click on the chart twice to enlarge.
Here is an update on my main wave count for the Euro. It calls for an impulsive move up into the .382-.618 fib zone. The real tell-tale sign for me that the top for the Euro is “in” at 1.49421 is that the aggressive move to a new low that started at 1.43450 and ended at 1.39687 looks like a “three”. This would count out the possibility of a complete ABC zigzag down from the 1.49421 high to complete a wave 4 pink, if in fact the 1.49421 high was only the apex of pink wave 3. It also counts out a 1-2-1-2 bearish count. So, since the May 4 high, I believe we’ve seen an impulsive pink wave one complete, and we’re now in a WXY in the shape of an expanded flat for pink wave 2, with a more normal, deeper retracement into the .382-.618 fib zone or higher expected.
There is a nice target zone near the .0382 fib which includes the extreme of wave 4 of one lesser degree (shown by a green horizontal line), and the 2.618 fib extension of the wave labeled wave a orange, shown by an orange horizontal line. I’ll be looking for a purple wave 3 to be pointed out by a MACD extreme, and then a new wave 5 purple high, accompanied by MACD divergence for that long awaited opportunity to once again get short. I’ll also be looking at the wave structure in the stock market for similar clues of a completed upward structure at about the same time for confirmation.