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Wednesday, January 11, 2012

Elliott Wave and technical analysis on the USD-Index; EUR/USD; USD/CAD; AUD/USD; DJI; VIX; Shanghai Comp.; CRB; Gold; Silver; Copper and Crude oil

USD-Index - Respected support at 80.70 very nicely and we could be on the road for the next rally higher towards resistance at 82.60.
EUR/USD - Here too we saw resistance at 128.15 well respected, which means we could be headed down through support at 127.20, confirming the next decline towards the 125.45 area, where we will find the next very strong support.
USD/CAD - Stalled at resistance at 103.20 to gather new strength for the next challenge of this resistance. When resistance at 103.20 breaks we are looking at a new rally towards the 117 - 118 area.
Short term we are back testing the steep former resistance-line, which has now turned into support in the 101.20 - 101.30 area. Buying in this area represents a low-risk buying opportunity as we not allowed to break below support at 100.49, so stops can be placed just below 100.49 say 100.40, which will leave you with a risk of just above 1%. You don't get it much better than that.
AUD/USD - Is also close to its strong overhead resistance, which I expect will hold for a break below support at 98.55 which should trigger the next deep decline towards support just below 94.00 and in the 80 area longer term (longer term is from 3-6 months).
A break above 105 would come as a big surprise to me, but only above 107.52 invalidates the downside pressure for a new rally towards the 110.80 high.
Dow Jones Industrial - Reached just above 12,500 yesterday and backed off. Is a top in place? It's to early to say. We need a break below support at 12,284 to confirm the top. However the rally to 12,514 was followed by multiple divergences at the MACD-indicator telling us, that this is a weak rally and that we should be careful in these lofty areas. VIX-Index - Made a slightly lower low at 20.05, thereby fulfilling all demands to end the ending diagonal. However we need a break above 21.78 and more importantly 23.73 to confirm that an important bottom is in place.
The market has in my view become way too complacent lately and this is a dangerous cocktail and risk is much higher to the downside and the possibility of further gains.
Shanghai Composite - Here to we have meet resistance near 2,300. See how all markets are lining up at resistance or supports. I do think we are close to a very volatile period.
CRB-Index - Here too we are at strong resistance, which could and most likely will turn focus to the downside again. Longer term I'm still looking for a more firm test of strong support in the 292 - 293 area, but if this area breaks we are looking at 247 as the next target.
Gold - Here too we are at resistance, ready to be rejected and facing a new decline towards support at 1,520 and likely lower towards 1,489 and 1,281 longer term.
Silver - Here too we are back test the former support-line, which has now become resistance. I expect resistance in this area will hold for the next challenge of strong support in the 26 area, but ultimately I expect this support to be broken for a move lower towards the next strong support in the 21 area.
Copper - Do I have to say it? Facing resistance and is most likely to be rejected for a decline below 337 calling for a new test of the neckline support near 305.
Crude Oil - At resistance too. A Diverging MACD-indicator. Again the most likely outcome is a rejection here at resistance for a decline below support at 100.30 and more importantly 98.30 calling for a new decline towards strong support at 92.50.

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