EUR/USD - Here I'm still looking for one more rally higher towards the 1.2500 area, from where I expect a decline back towards the 1.2040 low if we are in a flat correction. If the ongoing correction is an expanded flat correction we should see a decline towards 1.1864 from near 1.2500.
Short term the ongoing correction is a minor flat correction calling for a move down to just below 1.2342, before we see the last rally higher towards the 1.2500 target.
USD/JPY - The rally of the 77.91 low is a mess, which does make kind of suspicious. The only valid impulsive wave that would fit is, that we are in an expanding leading diagonal. If this is the case the formation is not yet over as we need a move above 78.77, before it fulfills the demands. The risk is a direct decline below 78.14 that will invalidate this count as call for a new test of 77.91 and likely the important 77.65 support.
EUR/JPY - After the test of 79.80 we have seen a flat correction develop and we are currently in wave "c" of this flat. Expect this c-wave to fall to just below 96.70 (likely in the 96.33 - 96.44 area), before the more dynamic and powerful red wave iii takes off towards 100.30 and possibly even 101.52.
EUR/NZD - Sorry that I haven't updated this cross for the last 4 days, but my normal back-up system does not have any data on this cross, but I finally found a substitute that did.
As you can see I have had to change my count from 1.6969 as we continued to break lower and the above count seems a better fit. That said odds begins to favor, that we saw an important bottom at 1.4968 and we soon should see important resistance at 1.5444 tested. Short term however we will likely see a minor correction back towards 1.5194 and maybe even a back-test of the broken trend-line near 1.5125 before the next rally higher.
Non-confirmation between DJI and DJT - The non-confirmation between the Dow Jones Industrial Index and the Dow Transportation Index continues to be in place. In 2007-2008 it evolved into a major crash. The 2011-2012 has not yet evolved into anything meaningful, but it tells us that the rally in the Dow Industrial is a relative weak rally.
I'm not looking for a new crash like the 2008 crash, but I do look for a serious decline towards the 9,500 - 9,850 area before the next big rally higher.
VIX Index - We are back to the
complacency area, telling us that the current rally in the Dow Industrial and the S&P 500 will not continue for much longer. However we need a break above the 20 day moving average at 17.41 to indicate a rise in risk aversion, but only a break above 21.00 will call for something more serious.
Facebook - Has ended the first rally of the 19.82 low and we should expect a deep correction towards the 20.30 - 20.50 area before the next rally higher. Buying in the 20.30 - 20.50 area should pose a low-risk opportunity with a stop just below the 19.82 low. Longer term I'm looking for a rally back to strong resistance at 33.00
TLT (Barclay's 20Y+ bond fund) - Is well under way towards the first target near 124.09, but a clear break below here will indicate that we are in for a much deeper decline towards strong support at 109.69. However we should remember that support near 124.00 is pretty strong too.
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I think USD/JPY has not bottomed yet. There is a last 5th wave left. So what we are seeing now is the flat or expanded flat of wave iv of 5.
ReplyDeleteHi,
ReplyDeleteIt's most certainly a possibility. As I have said in my last post the rally from 77.90 is in no way impulsive and one should stay flexible to whatever outcome bullish or bearish.
Kind regards
EWS