Looking at the shorter time-frame we likely saw a rare fifth wave failure yesterday at 115.96. The failure to break into new high ground materialized to powerful correction, which has reached 114.46 as its low point. However, a break below 114.40 and more importantly a break below 113.99 is needed to confirm, that we did indeed see the top of wave 3 at 115.96 and wave 4 is under way. If we have entered into the wave 4 correction we should see a correction down to at least 112.30. That said, as long as support at 114.40 protects the downside I will look for a new rally higher towards 115.22, but only a break above 115.99 revives the uptrend for a move higher towards the 117.30 - 117.85 area.
We are now within striking distance of the 61.8% correction target at 1.5740 of red wave i. We are clearly seeing a loss of momentum and I do expect this support to protect the downside for a new rally. However a break above 1.5908 and more importantly 1.5988 is needed to confirm the bottom for a new rally higher. A break above 1.5988 will call for a new rally higher towards 1.6218 as the first target, but I expect a move higher towards at least 1.6515 in red wave iii and likely even higher. The risk is of cause a clear break below 1.5740, which would call for a continuation down to 1.5671, where we will find the next strong support level.
No comments:
Post a Comment