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Happy New Year to you all and a prosperous 2012

Elliott Wave analysis on EUR/TRY

EUR/TRY - Topping out here? I think so. we have seen an ending diagonal developing since early 2006. The throw-over in August and October also marks the boundaries of a minor double top and a break below 240.60 will confirm the top and a decline to the long term support line, which currently is near 199.25 and rising.
A break below 240.60 will trigger the double top for a decline towards the 222 - 223 area.
The nice thing about this cross is, that the yield on TRY (Turkish Lira) is a little over 8% in the 1 and 3 months periods, which will leave you with a nice premium to the spot rate.

Elliott Wave analysis on GBP/USD

GBP/USD - Forgot to add this chart of Cable. We are most likely seeing a break down of minor support at 154.30 and should be headed for the next support at 151.50. Longer term we should see a decline to at least the 134 - 137 area, but I would not be surprised to see a continuation down towards the 118 - 119 area.

Elliott Wave and technical analysis on the USD-index; EUR/USD; USD/JPY; SP 500; Shanghai Comp.; Gold and Crude Oil

USD-Index - It is just a matter of time before we break clearly above resistance at 80.40 for the next rally higher towards 82.60 and the inverted S/H/S target at 87.55 longer term.
We might need some more consolidation just below 80.40, but as I said it's just a matter of time before it breaks.

EUR/USD - Have already broken below its support and should be headed down towards its next target in the 125.45 - 126.45 area. Longer term the S/H/S target measures down to 112.25, but remember the strong Pitchfork support near 126.45.

USD/JPY - Wasn't able to break above long term resistance, which most likely will cause a move back to support at 77.15 before the next attempt to break above the long term falling trend line.

Only a clear break above resistance at 78.15 will confirm, that an important bottom is in place at 75.50.

S&P 500 - I'm still looking for a move higher towards 1,292 and maybe even closer to 1,299, but more than that isn't expected. From the 1,292 - 1,299 area we should see a new powerful decline below 1,248.68 and more importantly 1,229.50, which confirms the next decline to 1,202 and lower.

The longer term picture (see below) is still dominated by the major S/H/S top calling for a return to the at least the 2009 lows.

Shanghai Composite - I still see this as an ending diagonal, where we are missing the last leg down towards the 2,110 area, from where a correction higher towards the 2,239 area should be seen.

Short term look for a break below 2,171 to confirm the last leg down.

Gold - Made it down to my target area between 1,528 - 1,535 and we should now see a correction towards the 1,613 and more likely towards the 1,636 - 1,642 area, before the next challenge of support at 1,528 will be seen.

Crude Oil - Is setting it self up for a powerful decline towards 92.80 and lower. At the chart above we can see an interesting fractal in the MACD, which calls for an extended period in the oversold area calling for a powerful decline. The last time we saw this, crude oil dropped more than 5% in one day, so be very careful in these lofty areas. Short term I do look for one last move to just below 101 - Ideally 100.96, which should mark an excellent selling opportunity

The bigger picture (see below) also calls for a decline towards the neckline, which currently is at 77.40 moving up slightly.

Elliott wave and technical analysis on EUR/USD; USD/CAD; EUR/CAD; S&P 500; Shanghai Comp.; Italian Bond Yields; Gold and Crude oil

EUR/USD - We finally saw the next impulsive move to the downside yesterday. We should now be headed for support in the 125.45 - 126.45 area. We will find very strong support in this area, but if it breaks we should be looking for much lower levels longer term.

USD/CAD - Most likely ended its triangle "X" wave yesterday and we should soon test resistance at 104.25 and more importantly neckline resistance near 106.25. Should 106.25 be broken, look for a rally towards the 117 - 118 area.

My triangle count seems to be the best count for now, but it could as easily be a series of one's and two's, but for now lets stay with the triangle count as the outcome in the short to medium term will be the same - A rally towards the 117 - 118 area.

EUR/CAD - Is clearly breaking down from its six months corrective pattern, which calls for a decline to below 124.75. The broken former support line, now resistance, near 133.20 should hold, but we must accept a small penetration to the 133.60 - 133.90 area before the next serious decline.

S&P 500 - The clear break back below 1,256 has invalidated the inverted S/H/S, so bye bye to the possible 1,360 S/H/S target. That means we still could see 1,292 and 1,299 tested as long as we don't break below 1,242.85 and more importantly 1,229.50. A break below the later confirms that we have seen a top and support at 1,202 is under fire again.

Shanghai Composite - Is in the later part of an ending diagonal. We need one more decline towards 2,110. If my ending diagonal count is correct we can't go below 2,098 as that would invalidate this count.

After the test of 2,110 I would look for a move back towards the 2,330 - 2,340 area. from where the next decline towards 1,800 should begin.

10Y Italian Bond Yield - Even after a successful six month bond auction yesterday the 10Y yield stayed above 7%. A break above 7.3% will open up for a move towards 8.25 - 8.45%.

I do think it's just a question of time before the break above 7.3%

Gold - Is clearly on its way to the support-area between 1,528 - 1,535, which most likely would cause a corrective move back towards 1,636 area, but longer term the downside is now open for a move towards the 1,284 area (see the long term chart below)

Crude Oil - The failure break above the resistance line was confirmed by the break below 100.30 and we should now be looking for a break below 99.15 to confirm the next decline towards 96.09 and lower.

Technical analysis on EUR/CAD; US T-Bond Yield; Gold and Crude oil

An other slow day with very low volume.

EUR/CAD - Seems to be breaking down from its six months corrective pattern, which ultimately calls for a decline to below 124.75. The former support line at 133.17 is now becoming resistance. That doesn't mean we can't penetrate it slightly but not beyond 135.50 as that would leave us with a failure break.

US T-bond Yield - Has broken below support and is currently back testing the former support line, which has now turned into resistance. The downside should now be open to a decline towards the Double Top neckline (pink) near 135.50.

Gold - Should be headed towards support near 1,528, where strong support will be found. Looking at the bigger picture (see this link:
http://theelliottwavesufer.blogspot.com/2011/12/elliott-wave-analysis-on-eurusd-usdjpy_15.html) a much deeper decline could well be in the doing.

Crude Oil - Here we most likely have a failure break above the resistance line, whats needed now is a break below support in the 100.30 - 100.40 area, which would call for a quick decline to support at 96.09 and a break here confirms the next powerful decline towards 89 and below 75 longer term.

Technical analysis on EUR/USD; EUR/CAD; S&P 500; VIX-Index and the 10Y Italian Govt. Bond Yield

In a thin after the holiday market I have decided to look at some different charts.

EUR/USD - Still in a holding pattern, but I also still look for a breakdown below 130.17 to confirm the next decline towards the 125 - 126 area.

Short term resistance is at 131.

EUR/CAD - Might be breaking down from a six months corrective pattern. If we break clearly below 133 we should see a move to below 124.75.

Short term resistance is in the 133.75 - 134.25 area.

S&P 500 has broken above resistance at 1,256 calling for a move towards 1,292 and likely also near 1,300, but the stock market participants is clearly getting to complacent and we should be aware of a sudden collapse in prices.

As I wrote on December 25. a inverted S/H/S pattern can be seen and it does have a target near 1,360, which we might have to fulfill. After the break above 1,256 I would be cautious bullish, but I would not run after anything is this lofty area.

VIX - Index - As I just said. The markets is becoming too complacent, but we are clearly looking at some kine of ending diagonal, which probably has a little more downside, but when its done we should see a quick move to the upside.

The 10Y Italian Government Bond Yield - We are closing in on the important resistance at 7.30 and a break above here would call for a continuation towards the 8.25 - 8.35 area.

This situation is not sustainable in the long run. If a solution is not found pretty quickly the hole Euro system could collapse. I'm sure that EU and the Italian politician will do what ever to kick the can further down the road, but in the long run status quo can't be maintained with yield this high.

Santa Claus came this year too

HO HO HO... We clearly broke above the 1,256 resistance and the next target to look for is at 1,292. But look closely at the chart and you will notice, that an inverted S/H/S bottom was triggered with the break above 1,256 and a target near 1,356. Along the way to the S/H/S target strong resistance will be found at 1,292 and in the 1,299 - 1,300 area. So be aware if one of these resistance points turns prices clearly back below the neckline.

Have a Merry Xmas.

Technical analysis on the USD-Index; EUR/USD; USD/JPY; S&P 500; Shanghai Comp.; T-Bonds; Gold; Copper and Crude Oil

Today's post will be very long. Hope you will enjoy it.

USD-Index - We saw a nice back test of the neckline support and the rejection at that support suggest, that we soon should see minor resistance at 80.14 break for a move towards important resistance at 80.73 and a break here confirms the next serious rally towards 82.60

EUR/USD - Here too we saw a nice back test to the neckline resistance at 132.05. I'm now looking for a break below 130.20 to confirm the next decline towards 125.75.

For the short term we might need more time trading more or less sideways, but it should only be a question of time before we see support at 130.20 lost.

USD/JPY - Can feel the long term trendline resistance on its back as it tries to push above. Will it succeed? If we can break clearly above 78.30 then we can say, that an important bottom was found at 75.50 and a break above the neckline resistance at 79.15 should confirm a rally back to the wave 4 triangle apex at 115 longer term.

S&P 500 - We are facing resistance here at 1,256. I don't think it will be any easy task to break above here. We are packed with resistance in this area and a break below 1,247 and more importantly 1,229.50 will turn the tide and call for a move towards support in the 1,200 - 1,202
area.

Shanghai Composite - The red Pitchfork mid-line is doing its best to prevent a collapse in prices, but if we are in wave 3 down as I expects, then the mid-line will give in to the pressure at some point and a collapse towards 1,662 should be seen.

T-Bonds - I just thought that the pattern is very interesting here. We might be building a major double top with a neckline at near 135.50. However we also have good support at 142.25 and a break below here will confirm a decline to the neckline.

Gold - With only five trading days back the break below the support line from 2009 might be closer than many Gold-bugs like. If this trendline is broken then we should turn focus towards the downside for a quick test of support at 1,528, but I believe we will a move towards the 1,283 area too.

Copper - Is back testing the minor support line (now resistance), that was broken last week. We should soon see a more firm test of the neckline support near the 305 area and a break here will spell real trouble for the Global economy.

Crude oil - Is testing strong resistance here in the high 99 area. We should be close to a new break-down in prices. A break below 99.15 and more importantly 98.50 confirms that a top is in place for the next serious decline. Until we loose 99.15 we could see a move to 100 and maybe just slightly above, but don't bet on it...

Elliott Wave analysis on EUR/USD; USD/JPY; AUD/USD; S&P 500; Gold and Crude Oil

EUR/USD - After a almost perfect back test of the neckline resistance, we are now ready to continue down to next support at 129.56 and then very strong support just below 126.
Short term i would expect resistance at 130.90, but we must accept a move towards 131.30 before a break below 130.10 confirms the next serious decline


USD/JPY - We are closing in on long term resistance in form of the long term falling trend line at 78.15 and we need a break above here to confirm, that an important bottom is in place at 75.50 and a rally towards the triangle apex at 115 has begun.
This is not the most pretty picture I have ever seen, but I still favor a break above 78.15 for a move towards the low 79 area, where we will find neckline resistance.

AUD/USD - Clearly took advantage of the risk on rally we saw Tuesday, but we saw a large bearish wick yesterday, which calls for a break below 100.50 to confirm the next decline towards 98.85.

Short term I looking for a test of minor resistance at 101.15 and maybe even 101.60, before the decline through 100.50 confirms the next move down.

S&P 500 - Is doing its best not to loose sight of the pink Pitchfork resistance line near 1,243. Even if we does see a move to 1,256 resistance will be hard to break short term. Only a clear break above 1,256 will confirm the Santa rally to just below 1,300, but as everybody is now looking for that move will we see it? I doubt it, but lets see what happens as we get closer to resistance at 1,256.

A break below 1,202 will invalidate any further upside progress.

Gold - Spiked a little over my resistance at 1,634, but as can be seen it was clearly a failure break and the following break below 1,605 tells us, that we are headed towards important support at 1,528.

Short term we could see a move towards the 1,623 -1,627 area before the next serious pressure to the downside sets in.

Crude Oil - Did a little more upside progress than expected, but I don't really see much more power in this rally, maybe one last move higher towards the 99.50-99.75 area. I would be looking for selling opportunities around this area or a break below 96.70 as the safer bet, for the next decline towards 92.54 and 89.20.

Elliott Wave analysis on USD-Index; EUR/USD; USD/JPY; S&P 500; Gold; Copper and Crude Oil

USD-Index - Is back testing is neckline support. I expect this support to hold. We should allow for a minor penetration, but in general it should hold for the next rally towards 80.50 for a move higher towards 82.50.
Short term we should allow for a minor penetration of the neckline to the 78.80 - 79 area.

EUR/USD - Here I would look for a move back towards 132.05 back testing its neckline resistance, but the is no change in my overall view, which is down and a break below 130.60 will confirm the next serious decline has begun.

USD/JPY - Is holding just below trend line resistance near 78. We still need a clear break above this trend line resistance to confirm, that we saw an important bottom at 75.50.

A clear break above the trend line resistance will open for a move towards neckline resistance near 79, but at the same time confirms a rally back towards the triangle apex at 115 longer term.

S&P 500 - Did indeed hold support at 1,200 (low was 1,202.37). Even though we broke above 1,231 to confirm a Santa Rally we will face resistance here at 1,242 again at 1,258 and only a break here confirms a move higher to just below 1,300.

Gold - Also enjoyed the risk on rally we saw yesterday, but we are not done with the downside just yet. We still need a decline towards the 1,535 area. We should find good resistance in the 1,628 - 1,634 area. Any break below 1,605 will confirm the minor correction finished and call for the next decline towards 1,535.

Copper - Is back testing the broken minor support line (now resistance). I still looking for a more serious test of the neckline support at in the 305 area. We might not break below in the first attempt, will most likely will at some later point.

Crude Oil - The correction from 92.54 broke above 97.36, which has altered the short term count slightly. The break above 97.36 tells us, that wave iii down has not yet begun, but that we are in a series of wave one's and two's.

We are facing strong overhead resistance near 98.70, which I do expect will protect the upside for a break below 96.65 and more importantly 94.15, that will confirm the next serious decline has begun.