EUR/USD; Gold and Crude Oil - Expect new rallies soon

EUR/USD - We are still working on wave E of the endning diagonal, which will make wave C of [B] and setting the stage for wave [C] down.


In the shorter term picture the most likely count is that we have seen wave a and is working on wave b, which should set the stage for a rally in wave c soon. As we are in the final parts of the bigger ending diagonal I have my doubts that we will see a rally all the to 156.93. I find it more likely that we will see one of the more rare running flats, where the final "C" leg doesn't reach it's normal target if it wave a regular flat or even an expanded flat.




The reaction from 1,628 doesn't look impulsive and the best fit is that minor wave (iv) has extended in time and is stetting the stage for one final rally in wave v higher towards my target near 1,636. Only a break below 1,600 would call for the top being in place.

Crude Oil - Not much to add here. I'm a bit dissapointed in the last couple of days price-action, but non the less I'm still expecting one final rally to end the ending diagonal and setting the stage for wave [C] lower.

Overall it seems as we are reaching an important point in time soon, where we should see major tops in the equity and commodity markets and we should see a stronger USD. Be aware that AUD, CAD and ZAR all have benefitted more than could be expected and should face quite a decline.

I'm particularly looking at two stock indices for clues. One is the Shanghai Composite - A clear break below 2,610 will be the clue here. The second index is the Swedish OMXS30 - A clear break below 1,045 will be the clue here. You might ask, why the Swedish OMXS30 is important or can provide any clues in regard to where S&P 500 is going? Please check the bottom chart.

A clear break below 2,610 in the Shanghai Composite could actived the major B-wave triangle, which has been building for the last couple of years. Abreak below 2,610 could be a warning that the China-bubble has finally been blown.

It seems that the OMXS30 tops and bottoms before the S&P 500 and cloud provide us with an early warning that a major top might be in place for the S&P 500.