Time to vacation in the Italian Alps

It's time to a break and I will be traveling to the Italian Alps for the next two weeks. There will be no updates during that period. 

Trade wisely and take care

EWS

Elliott wave analysis of Silver - Is testing important resistance at 18.51

Silver - Is testing important resistance at 18.51 

Silver is trying to break above the Inverse S/H/S bottoms neckline near 18.00 and more importantly above resistance at 18.51 and if the later is broken too, then a rally towards the measured S/H/S target at 22.05 should be expected as a minimum, but this rally could easily extend higher towards 25.10. 

The Inverse S/H/S neckline at 18.00 will now shift from resistance to support and will ideally protect the downside, but only a break below support at 17.52 will question the break above the neckline. 

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Elliott wave analysis of Apple - Correction from 134.54 is headed towards 55.01

Apple - Correction from 134.54 is headed towards 55.01

Already on April 29 - 2015 I called the top at 134.54 and said then, that a decline to the previous low of 55.01 was to be expected (you can see that post here) and on August 4 - 2015 I said that the top at 134.54 was confirmed and a corrective decline to 55.01 should be expected (you can see that post here). 

Well the correction from 134.54 is well under way, and it should just be a matter of time before support at 89.47 is broken for the next decline to 67.40 and then 55.01. 

Short term, resistance is seen at 94.66. This resistance is expected to protect the upside for the break below 89.47 for the next wave lower to 67.40 and 55.01. 

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Elliott wave analysis of CHF/JPY - Ending diagonal complete

CHF/JPY - Ending diagonal complete 

The ending diagonal resistance-line has just been broken confirming that the ending diagonal is complete. This means a rally towards the origin of the ending diagonal at 117.42 should be seen within half the time it took for the ending diagonal to develop. 

Short term support is found at 109.30, but I doubt this support will be seen.  

However. the ending diagonal also completed the long term corrective decline from 138.92 and this top should ultimately be broken as the next long term impulsive rally develops. 

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Elliott wave analysis of GBP/USD - To move lower no matter what today's outcome will be

GBP/USD - To move lower no matter what today's outcome will be 

The potential upside should be limited from here. Wave iv could already be in place with the 1.4844 high or we might see a move slightly higher to the equality target at 1.4944 from where a turn lower is expected. 

The rally of the late February 2016 low at 1.3834 is seen a corrective and this impulsive rally from 1.4010 should complete this correction and turn prices lower again in wave v. 

The ideal target for wave v is seen at 1.3344, but GBP/USD has a habit of extending its fifth wave, so the potential downside could be deeper. 

No matter, which way today's vote goes a decline should be seen soon. The top will be confirmed by a break below minor support at 1.4641

This also fits my preferred long term view well (you can see the long term view by clicking here). 

Only a failure to break below the 1.3834 low followed by a new impulsive rally calls for the alternate count (see the long term view).  

Elliott wave analysis of Special Brexit Report

Special Brexit Report

A Special Brexit Report has been issued for the EWS members:Elliott Wave Surfer Service

During yesterday's BBC debate the London Eye lite up showing the Leave 58%  (red) and 42% stay (blue).

What does the Elliott Wave Count say for Cable and FTSE 100? Join the EWS service and get your own copy.

Elliott wave analysis of Dow Jones Industrial - Long Term View

Dow Jones Industrial - Long Term View 

Way back in March 2012 I posted some interesting Fibonacci relationships for the rally from the 1932 low. 

Then the next relationship was the 2008 + 5 = 2013. However, 2013 went and nothing happened, but here we are again at an interesting year as 2008 + 8 = 2016 indicating a possible top some time during this year. 

I of cause can't say with any degree of certainty why the Fibonacci series was broken, but I do think FED distorted the normal cycle, by QE 1,2 and 3 and thereby moved the cycle towards the next Fibonacci number. 

I have been working the expanded triangle consolidation for years, but I have of cause some alternate count, which could be possible counts too. Only the alternate count #2 allows for a move slightly higher to 20,098 before wave [III] finally is in place and a major correction in wave [IV] develops. 

All the three counts calls for wave [IV] either unfolding already or beginning to unfold soon. 

If we apply the Alternation Principle wave [II] was a simple and deep decline, which means that [IV] should be complex shallow (this is the primarily reason, why I favor the expanding triangle count). The ideal bottom for wave [IV] should be expected in 2021:

2000 + 21 = 2021

2008 + 13 = 2021

2016 +   5 = 2021 (the cycle jumped one number, like because of FED and the QE).  

ALTERNATE COUNT #1

ALTERNATE COUNT #2

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Elliott wave analysis of Crude Oil - Long term View

Crude Oil - Long term View 

Since the June 2007 high at 147.27 a double zig-zag correction has been unfolding. The first zig-zag was a very sharp decline seen from the 147.27 high to a low of 33.20 as wave [W]. From the 33.20 low a corrective [X] wave was seen to 114.81 setting the stage for the second zig-zag decline to a low of 26.06 in early February. 

The big question now is, whether the ongoing rally will represent a new impulsive rally or another [X] wave should be expected? I do prefer the [X] wave count unfolding from the 26.06 low, but no matter what count proves correct, we should see much more upside in the weeks/months ahead. 

The first important target to look for is seen at 62.58, from where a correction to 49.00 and maybe even lower to 42.72 should be expected before the next big rally higher towards the long term resistance-line from the 2008 higher. 

If the resistance-line breaks the rally is expected to all the way back to 107.76, but the resistance-line will likely not be broken on the first attempt if at all. 

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Elliott wave analysis of CHF/JPY - The ending diagonal resistance-line near 109.44 about to be tested again

CHF/JPY - The ending diagonal resistance-line near 109.44 about to be tested again

On June 10 I posted an article saying the the ending diagonal resistance-line near 111.50 was about to break (you can see that post by clicking here). Well I was a wave too early and the ending diagonal resistance-line held for one final decline to 107.13. 

This final decline performed a classic under-throw of the ending diagonal support-line and quick return into the ending diagonal formation, which normally is a strong indication of the bottom being in place. To confirm that the ending diagonal is complete, we need a break above the ending diagonal resistance-line currently near 109.44 and above here will call for a rally towards the origin of the ending diagonal at 117.41, within half the time it took to build the ending diagonal. 

Long term, much higher levels will be expected. 

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Elliott wave analysis of Gold - Long term View

Gold - Long Term View 

Since the November 2011 high at 1,921 gold has decline in five waves to 1,046 in November 2015. A five wave decline indicates that a large zig-zag (5-3-5) correction is unfolding. 

We have seen wave [A] from 1,921 to 1,406 and is currently in the middle of wave [B] which is expected to move higher towards the 1,457 - 1,521 area before terminating and turning lower in wave [C]. 

If wave [C] becomes equal to wave [A] in length, then wave [C] should decline to 611. 

That said, strong support is seen both near 850 and below near 693 which both could provide support strong enough to terminate the long term correction from 1,921 and turn prices higher again. 

I prepared a special report to my subscribers on June 8. If you want a copy of this special report for free, then please send a e-mail to: ews@elliottwavesurfer.com saying "YES" and it will be e-mailed to you asap. It is very educational too.

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Elliott wave analysis of GBP/USD - Long term View

GBP/USD - Long term View 

GBP/USD (Cable) has been unfolding in a series of three wave declines and rallies. The last complete corrective rally terminated in November 2007 at 2.1161 as an [X] wave, from where a new three wave decline is unfolding. 

The first part of this new three wave decline saw a decline from 2.1161 to 1.3504 as wave A and was followed by wave B to 1.7191 an almost 50% correction of wave A and wave C lower is currently unfolding. 

The ideal target for wave C is seen at 0.9534 where wave C = A, but first the long term support at 1.3685 needs to be cleared. This long term support has been able to protect the downside since 1986, but when it breaks there will be no looking back for a long time. However, because of its importance, it can't be ruled out that it will be able to protect the downside for a more complex wave B, but for now the long term focus should remain towards the downside. 

Only a break above resistance at 1.4770 will ease the downside pressure and indicate a more complex wave B correction is unfolding (see the chart below). 

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Elliott wave analysis of GBP/USD - Long term View

GBP/USD - Long term View 

GBP/USD (Cable) has been unfolding in a series of three wave declines and rallies. The last complete corrective rally terminated in November 2007 at 2.1161 as an [X] wave, from where a new three wave decline is unfolding. 

The first part of this new three wave decline saw a decline from 2.1161 to 1.3504 as wave A and was followed by wave B to 1.7191 an almost 50% correction of wave A and wave C lower is currently unfolding. 

The ideal target for wave C is seen at 0.9534 where wave C = A, but first the long term support at 1.3685 needs to be cleared. This long term support has been able to protect the downside since 1986, but when it breaks there will be no looking back for a long time. However, because of its importance, it can't be ruled out that it will be able to protect the downside for a more complex wave B, but for now the long term focus should remain towards the downside. 

Only a break above resistance at 1.4770 will ease the downside pressure and indicate a more complex wave B correction is unfolding (see the chart below). 

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Elliott wave analysis of GBP/USD - Long term View

GBP/USD - Long term View 

GBP/USD (Cable) has been unfolding in a series of three wave declines and rallies. The last complete corrective rally terminated in November 2007 at 2.1161 as an [X] wave, from where a new three wave decline is unfolding. 

The first part of this new three wave decline saw a decline from 2.1161 to 1.3504 as wave A and was followed by wave B to 1.7191 an almost 50% correction of wave A and wave C lower is currently unfolding. 

The ideal target for wave C is seen at 0.9534 where wave C = A, but first the long term support at 1.3685 needs to be cleared. This long term support has been able to protect the downside since 1986, but when it breaks there will be no looking back for a long time. However, because of its importance, it can't be ruled out that it will be able to protect the downside for a more complex wave B, but for now the long term focus should remain towards the downside. 

Only a break above resistance at 1.4770 will ease the downside pressure and indicate a more complex wave B correction is unfolding (see the chart below). 

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Elliott wave analysis of GBP/USD - Long term View

GBP/USD - Long term View 

GBP/USD (Cable) has been unfolding in a series of three wave declines and rallies. The last complete corrective rally terminated in November 2007 at 2.1161 as an [X] wave, from where a new three wave decline is unfolding. 

The first part of this new three wave decline saw a decline from 2.1161 to 1.3504 as wave A and was followed by wave B to 1.7191 an almost 50% correction of wave A and wave C lower is currently unfolding. 

The ideal target for wave C is seen at 0.9534 where wave C = A, but first the long term support at 1.3685 needs to be cleared. This long term support has been able to protect the downside since 1986, but when it breaks there will be no looking back for a long time. However, because of its importance, it can't be ruled out that it will be able to protect the downside for a more complex wave B, but for now the long term focus should remain towards the downside. 

Only a break above resistance at 1.4770 we ease the downside pressure and indicate a more complex wave B correction is unfolding (see the chart below). 

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Elliott wave analysis of EUR/USD - Long Term View

EUR/USD - Long Term View

The decline since the Juli 2008 high at 1.6038 is corrective in nature and therefore likely to be a larger degree X-wave. 

Breaking down this X-wave a clear three wave decline was seen from 1.6038 to 1.1876 as wave [A] and was followed by another clear three wave rally in wave [B] from 1.1876 to 1.4939. This means that wave [C] currently is developing. 

This [C] should be in five wave (impulsive) and as can be seen on the chart, the first three waves is complete and wave 4 is currently unfolding. 

As wave 2 was a simple, but deep, zig-zag correction that corrected slightly above 61.8% of wave 1 the alternation principle says that wave 4 should be more complex and be a shallow correction of wave 3. As can be seen wave 4 clearly is more complex in character and has not even corrected 38.2% of wave 3. 

The best fit for wave 4 as of now is that a triangle consolidation is unfolding. A triangle contains five waves from "a" to "e" and we are currently in wave "d" still missing wave "e". Once wave "e" is complete and thereby wave 4, a new impulsive decline towards at least 0.9880 should be expected.   

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Elliott wave analysis of GBP/JPY - The ideal 147.00 target is now within reach

GBP/JPY - The ideal 147.00 target is now within reach

The ideal target near 147.00 is now within reach.

The cluster of calculation that yields the 147.00 target indicates that this should be a support to be reckoned with. The most important calculations are the 61.8% corrective target of the rally from 116.82 to 195.88, which is seen at 146.80. Calculating the target for wave (v), the 38.2% target of the distance traveled from the top of wave (i) at 195.88 to the bottom of wave (iii) at 151.63 subtracted from the top of wave (iv) yields exactly 147.00.

The bottom of wave 4 of the rally from 118.77 to 174.85 is seen at 147.06, so we should expect support at 147.00 to be a force to reckoned with and likely being able to terminate the long term correction for a new impulsive rally that ultimately will take out the 2015 top at 195.88.

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Elliott wave analysis of Facebook - Is about to lose a lot of friends

Facebook - Is about to lose a lot of friends 

Since the September 2012 low at 17.55 FB has rally almost 690% and gather a lot of friends. However, FB is about to lose some of its friends in the months ahead. 

From an Elliott Wave perspective a five wave rally has been seen of the 17.55 low. The Elliott Wave Principle states that after a five wave rally a corrective decline should be seen. The five wave rally  in wave [3] from 17.55 most likely ended at 121.08 and a corrective decline in wave [4] is about to unfold.

So where can we expect wave [4] to end? Normally the low of wave 4 of one lessor degree, will be the main attraction. In the case of FB that means a decline to 72.00 or very close to a 50% correction of wave [3].

Since the low of wave 4 of [3] we have seen a pretty slow rally with overlapping waves, which is the signature for an ending diagonal. Once the ending diagonal is complete a decline back to the origin (in this case the low of wave 4 at 72.00) should be seen within half the time it took the ending diagonal to build. As it took 37 weeks for the ending diagonal in wave 5 of [3] to build, we should expect a decline back to the 72.00 low within 18.5 weeks.

The trigger for the expected decline, will be a break below the ending diagonal support-line near 116.00 and confirmation that a top is in place and the correction in wave [4] is developing will be a break below support at 106.31.

Even though a quick decline to 72.00 is expected, the entire structure of wave [4] will most likely be much more complex. The Alternation Principle says, that if wave [2] was a simple correction and it was, as it unfolded as a zig-zag, then wave [4] should become complex and take up time. So we could be looking forward to a combination of corrections or a triangle as wave [4], only time will tell. However, the important thing here is that we have a very good idea, what to expect from wave [4].    

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Elliott wave analysis of European Weakness - DAX, FTSE100 and CAC 40 all pointing lower

European Weakness - DAX, FTSE100 and CAC 40 all pointing lower

All of the major European indices has completed S/H/S tops call for more downside. 

The German DAX should be headed lower towards at least the S/H/S measured target at 8,877, but the Elliott wave count calls for even more downside towards 7,750.

The UK FTSE 100 should be headed lower towards at least the S/H/S measured target at 5,646, but here the Elliott wave count call for more downside towards 5,440

The French CAC 40 should be headed lower towards at least the S/H/S measured target at 3,884, but here the Elliott wave count call for a continuation lower to 3,488.50. 

That said, I do see a clear risk for these declines to be of much greater magnitude. Especially the French CAC 40 looks very vulnerable as a break below 3,892 will trigger an even bigger S/H/S top with a measured downside target at 2,440.

France currently has more that enough on its mind. As host for the European Championship, where them Hooligans again seems on the rise. Two major terror attacks, strikes etc.

The UK with its EU referendum, where a win to the leave side seems more and more likely, creating lots of uncertainties. 

Finally Germany, the European economic locomotive that seems to be moving ahead in an ever more slowly pace and maybe even coming to a complete stop. Even worse the demographic in Germany will be a major drag on Germany economy for years to come.    

European trouble seems easy to find. It's much harder to find the bright spots...

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Elliott wave analysis of Nasdaq 100 - S/H/S top building

Nasdaq 100 - S/H/S top building 

The Nasdaq 100 index topped at 4,781 in March 2000 and dived some 90% to a low of 795 ultimo September 2002 before staging a new large rally that most like topped 4,739 in late November 2015 and a major S/H/S top seems to be building. This top formation will not be complete before the neckline support near 3,800 is broken, but when this neckline support is broken the downside potential is once again huge. 

From an Elliott wave perspective a huge flat correction has been building since the March 2000 high. Wave [A] was the decline from 4,781 to 795 and was followed by wave [B] to the November 2015 high. Wave [B] peaked just below the 2000 high and is made up of three waves, where wave W moved from the 795 low to 2,239 wave and was followed by an X wave down to 1,035 in November 2008 from where wave Y took over for the rally to 4,739. Wave Y became an extended wave and extended by close to 261.8% the length of wave W. 

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Elliott wave analysis of CHF/JPY - Is about to break above its ending diagonal resistance-line

CHF/JPY - Is about to break above its ending diagonal resistance-line 

I normally don't look at this pair, but when I saw that it has the same ending diagonal pattern as EUR/JPY I became interested. As you can compared to EUR/JPY ending diagonal, the ending diagonal here is almost about to break the resistance-line and when that happens a rally back to the origin of the ending diagonal at 117.42 should be seen, within half the time it took to build, which will be within one and half months. 

The ending diagonal resistance-line is currently sitting near 111.50 and a break above here confirms the rally back to 117.42 and above. 

The long term picture calls for a much higher rally than the 117.42 and actually calls for rally that ultimately will break above 138.92 top. 

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Elliott wave analysis of Copper - Look for a bottom between 2.01 - 1.98

Copper - Look for a bottom between 2.01 - 1.98

Copper has been hit hard this week due to large increases in the LME copper stockpiles, should we be worried? I don't think so. The Elliott wave count tells us that the three month correction from mid-March is close to terminating, with the ideal downside target seen at 1,98 from where a new impulsive rally to above 2.23 should be expected for a rally towards the 38.2% corrective target at 2.97. 

The first good indication of a bottom being in place, will be a break above 2.054, while a break above 2.09 will confirm the bottom for the next impulsive rally much higher. 

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Elliott wave analysis of Coffee - Ready for a strong cup of coffee

Coffee - Ready for a strong cup of coffee 

Coffee is about to get a lot strong. An Inverse S/H/S bottom has been building over the last 12 months and a break above the neckline resistance near 136.40 will complete the formation for a strong rally higher towards at least 157.95 and possibly much higher. 

If my long term count is correct, then coffee should rally all way back to the October 2014 high at 225.45 and likely even slightly above here for a move closer to 233.80 to end wave [B] and set the stage for a impulsive decline in wave [C] to below 111.05. 

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Elliott wave analysis of EUR/JPY - Bear-trap sprung and indicates a ending diagonal has completed

EUR/JPY - Bear-trap sprung and indicates a ending diagonal has completed

In my June 3 post (you can see it by clicking here), my final words was "I don't feel very comfortable about the downside and do think the downside is very limited, so please don't become overly bearish this cross and this time as a low can be found anytime now". 

Well that warning seem to be justified by the failure to build at the break below 121.46. In fact, I think that this was a nice bear-trap and that an ending diagonal has terminated at the 120.80 low and a quick return to the origin of the ending diagonal at 128.22 should be expected.

More importantly a break above the ending diagonal resistance-line near 123.80 will confirm that the long term correction from 149.56 finally has come to an end and a new impulsive rally finally can begin, with the first larger target being the 141.06 resistance.

Only a failure to break above the resistance-line near 123.80 and break back below 120.80 revives the 117.95 - 118.20 target, but that seems pretty unlikely to happen.   

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Elliott wave analysis of Feeder Cattle - Wave A is finally coming to an end near 130.78

Feeder Cattle - Wave A is finally coming to an end near 130.78  

Feeder Cattle is one of the more odd commodities I track from time to time. Way back in October 2014 I called the top near 244.80 (you can see that post by clicking here). In that same post, I call for a long term downside target at 131.53, well we will likely overshoot this target by a small fraction as the low is expected to be seen near 130.78.

As wave A is coming to an end, with an ending diagonal as wave v of A, we should be looking for wave B higher, with the first target to look for being the origin of the ending diagonal at 169.58. However, looking out further, I expect wave B likely will move higher towards 187.80 and possibly even higher to 201.25 before turning lower again in wave C. 

The clear divergence seen at the RSI indicator, does confirm that an important bottom is close by. 

Just a final word of caution. Remember that correction in the commodity complex often are extremely violent. 

This is a perfect example of the power of Elliott Wave Analysis. First spotting the top almost to perfection and then the bottom of first impulsive wave lower. To enjoy more calls like this, join the EWS as a member and be ahead of the rest. 

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Elliott wave analysis of GBP/JPY - Bottom to be found between 156.02 - 156.21

GBP/JPY - Bottom to be found between 156.02 - 156.21  

The decline from the 163.89 high has been relentless, but it's only part of an expanded flat correction and once the low is found a new strong rally higher should be seen. 

The low should be found in the 156.02 - 156.21 area. At 156.21 we have the magic 70.7% corrective target of wave [i] (I know that the 70.7% corrective target isn't a Fibonacci number, but it's seen more often holding back corrections to be a mere coincident). the 156.02 target is the limit for wave five of the small ending diagonal that has developed over the last couple of days. As the name "ending diagonal" says it marks the termination of the move and once finished a sharp reversal is expected.

The first indication of a bottom being in place is a break above minor resistance at 157.24, while a break above 158.01 confirms the low for a strong rally higher in wave [iii]. This rally will eventually take us back above the 163.89 top and longer term much more upside is expected.  

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Elliott wave analysis of EUR/GBP - Rallying nicely after a low at 0.7565

EUR/GBP - Rallying nicely after a low at 0.7565

On May 25 I said that the ideal target for the ongoing correction was seen at 0.7565 (you can see that post here). After a perfect touchdown on this exact target, a new strong rally is developing. 

A break above minor resistance at 0.7754 the low at 0.7565 will be confirmed for more upside progress towards 0.7947 and 0.8118 as wave 3 develops. 

Looking at the hourly chart (the upper chart), we can see that once the base channel resistance-line was broken the rally just gained even more strength, just as expected during wave 3. 

Finally a word of caution. Please do remember that corrections during wave 3 tend to be small or even sub-normal making the rally look almost vertical. 

This is a perfect example of the power of Elliott Wave Analysis. First spotting the low to perfection and already being 185 pips higher and this is only the start of the new impulsive rally. To enjoy more calls like this, join the EWS as a member and be ahead of the rest. 

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