Looking at the lower chart we can count a clear five wave decline from 2.03 (I don't why but many commodities have to make very clear counts at the very last part of an important move, which just might be the case here). A break back above 1.96 will be the first small indication that a bottom might in place, but we need a break above 2.03 to add confidence that an important bottom could be in place. In the bigger picture we need a break above 2.20 to see downside pressure ease.
One more thing I would like to add. No matter how difficult it is to pin-point a bottom here or no matter how hopeless it looks one thing is for sure... We will not hit zero!! That said and as long as we have no real evidence that a bottom is in place the downside pressure is intact and the risk of cause that we will see a deeper decline erasing 10; 25 or even 50% of the value from here can't be exclude, but don't bet on that outcome....
sir again its comes down after going above 1.96 it is creating bigggg pain here...can't understand where it is going.. what to do sir
ReplyDeleteLooks like strong long term support at 1.60
ReplyDeleteHi Chetan,
ReplyDeleteI am as certain as I can be, than we are in the target-area for this decline. Hammering out a bottom after a decline from 13.69 in 2008 and 4.98 since June 2011 cutting the price more than 60% will not be easy. Looking back in time you will find support at 1.85 from January 2002 and 1.76 from October 2001 together with the Elliott wave count suggesting that wave [C] ideally should end at 1.96.
I of cause can't give you any guarantee that 1.85 or 1.76 will be the bottom, but looking at the evidence i have in form of price-action and indicators the ongoing decline shouldn't be able to go much further. The new low that was produced yesterday was followed by a new divergence on the MACD-Indicator, which means we now have a triple divergence on the hourly time-frame you don't get a warning signal more powerful than that.
Looking at Candle sticks the last two candles have been hesitation candles also warning that the downtrend has matured.
Again I don't know your financial position, but a decline from to 1.76 from here will represent a decline of just under 9%.
Regards
EWS