Technical Analysis - The Day Ahead
Dow Jones 12,801 -0.69%
Base Metals Negative
US Gold CFD: 1718
Oil WTI: 98.90
US Copper CFD: 385
US Dollar: 79.20
EURUSD 1.32
AUDUSD 1.0670
Dow Jones CFD 12,800
S&P500 CFD: 1343
FTSE 100 CFD: 5857
DAX CFD: 6684
SPI CFD 4230
News
U.S. stocks were dragged down Friday afternoon by tumult over the Greek bailout, disappointing readings on the U.S. economy and a downgrade of nearly three dozen Italian banks.
US Commodities
US Gold CFD: 1718
TradingLevels: As on the 4 hour Elliott Wave chart, if we are in a Wave 4) then the 1700 would roughly be the support for the end of Wave 4)
Elliott Wave: ABC Wave 4), the Wave C has five waves and gold is in wave four , so another move down to around 1700 should complete the ABC Wave 4. A move under 1672 creates a larger bearish pattern. This Wave 4) should also be in line with the SP500 and AUDUSD and markets in general, so the next step is to see evidence of Wave four completed and that would be an impulse wave up (five sub waves) we will keep an eye out for the leading markets to pave the way
The Flipside:
The Bearish Count; would see Gold, Silver, Indices and the Euro roll over from here and the US Dollar push higher well above 80, we have to be mindful of both wave counts when using Elliott and we will be taking a closer look at this over the week ahead as most markets will be either in the Wave 4) mentioned above or a serious top is now in play and we have to study the unfolding structure’s this week carefully
Silver:
TradingLevels: As a wave four the price can drop below 33 to 32 area, this would be normal, if the price found 32 as the resistance then a larger top is in play and a move back to 30 would unfold, but first things first let’s just allow the wave four to play out
Elliott Wave: Wave four
Oil WTI: 98.90
TradingLevels: While the price is above the 98.00 the price is supported and is part of the 100 price level story. 98.00 as a retested resistance and we look for shorts
Elliott Wave: The wave count is up, but new long trades should wait for support on 100
Base Metals
US Spot Prices (in l/b)
US Copper: Last: 3.84-
US Nickel: Last: 9.37-
US Zinc: Last: 0.93-
US Aluminium Last: 0.99-
US Copper CFD: 385
Technical Analysis:
The 400 MediumLevel resistance is doing its thing; the price will continue to chip away at the supply. The price action pattern should be and abc corrective pattern and stabilising within SG2 372 as the pivot support.
The move down from 400 should be in three swings (abc)
Forex
Drop follows euro-zone ministers withholding approval of Greek aid package
US Dollar: 79.20
Technical Analysis:
The move up above 78.72 confirms the five waves down ending. The move up is currently in three waves (corrective abc) but we should wait to see if it develops further into five waves (impulsive) if this is the case, then we can expect another five waves up after a pullback (smaller abc) we will look at this pattern and other possible wave counts in the video
Expect a pullback into 79.
EURUSD 1.32
TradingLevels: Support SG2 13165|13172|13180
Elliott Wave: The five wave that we were counting from 130 to 133 are complete. Now looking for a 61.8% retracement 13140, as an ABC Zigzag correction. The current move down is likely just the Wave A the B and C to follow, like the AUD and Indices
Trading Strategies: Wait for the Elliott Wave abc Zigzag corrective pattern to complete, this can take two sessions then look for a long trade, with expected new highs
AUDUSD 1.0670
TradingLevels: The profit taking sure came in at 108 on que. The 38.2% for Wave 4) is in SG2 10580|10572|10565
Elliott Wave: We were talking about the move down as and abc correction and that is still the same, however we think the abc down is just part of a larger ABC Correction, that is the abc down is just the Wave A, so a Wave B up then a Wave C down to make the larger Wave 4)
Trading Strategies: You need to understand the structure of and abc corrective pattern to trade this. Wave four are not normally traded because of the short term swings and corrective patterns, that said scalping the Microlevels and a 2 minute chart goes on as normal
Indices
Dow Jones CFD 12,800
TradingLevels: The market will hang onto the 12,800 in the next session, the move down on Friday is about to see the counter trend, abc up then another five waves down.
Elliott Wave: If we are looking at a Wave 4) down then the 38.2% retracement level is around the 12,500 which is quite close the Wave four of one lesser degree 12530.
Trading Strategies: The first swing down is either the Wave a of an abc corrective move or Wave one of an impulse wave down, either way it’s a corrective move lower, so make sure you understand the wave structure.
S&P500 CFD: 1343
TradingLevels: Failed to find support on the Midpoint and should now check support lower at the next levels 1330 – 1300
Elliott Wave: The 38.2% retracement for this wave four is around the 1300 (mTL3 MinorLevel) Expect and abc Zigzag corrective pattern down
Trading Strategies: Day traders can look to short weakness into the next rally towards 1350
FTSE 100 CFD: 5857
TradingLevels: The 25 Dec Trendline is a support that cuts through the 5800 and the 5800 is also the first level of reasonable support otherwise the real support is down around the 5700
Elliott Wave: The move down appears to be impulsive and therefore should see a small rally and then another five waves down testing the 5800 and in line with US Indices
Trading Strategies: Short weakness on retests of the sublevels
DAX CFD: 6684
TradingLevels: The 6650 is a nice little support to see a retest of 6750 from
Elliott Wave: An impulse wave down, expect an abc counter trend rally then five waves down again
Day Trading: Trade the sublevels while in a corrective structure, use the sublevels and volume to check the support and resistance
SPI CFD 4230
Technical Analysis
TradingLevels: The current low is on trend line support, there is support in the 4200 region. And whilst the 4200 holds then the market is positive. The 4200 as resistance bring the market into the 4000 the MediumLevel support, but the price down at 4000 creates a corrective pattern for further downside. So the 4200 is important, we could see a spike below 4200 to 4150 but the price would need to regain support above the 4200 quickly for the market to remain positive
Elliott Wave: It’s just one corrective pattern after the next, but what this is tell us is that because it is corrective it will eventually break to the upside
Day Trading: Trendline support on 4230. The price is in Subgroup1 4230|4220|4210 so the price is going to bounce around a lot, even retest 4250 the Midpoint. Be very careful if your day trading in these numbers.
Summary
Our Elliott Wave Charts on the site are reflecting a Wave four retracement, once completed and further move higher into Wave five, this is for the US and European Indices and the AUDUSD, Gold etc. this is the Wave count we have been running with on our site, but we must always consider other plausible wave counts when using Elliott wave and the other Elliott Wave count is a top is now in place for the Indices, Euro, Gold, Silver and most markets, if this is the case then most markets will start working lower for the months ahead.
So we are at cross roads and must tread lightly, this means halving position sizes, trading shorter time frames etc. If the markets are in a wave four, then in the Elliott world traders don’t trade wave four as they swing in shorter lengths. So this week is a good time to do more observing and thinking rather than trading. If a more serious top is in play, then we will look to short Wave 2 so we have time, if it’s a wave four then we also have time, it is simply important not to get caught in the cross fire.
Trading Quote
Trading is a game of snakes and ladders, support and resistance, use stops.
Today's Financial Events
Time Currency Detail Forecast Previous
Monday, February 13, 2012
10:50am JPY Prelim GDP q/q -0.3% 1.4%
10:50am JPY Prelim GDP Price Index y/y -1.6% -2.2%
10:50am JPY Tertiary Industry Activity m/m 0.9% -0.8%
11:30am AUD Home Loans m/m 1.9% 1.4%
6:00pm EUR German WPI m/m 0.4% 0.0%
7:15pm CHF PPI m/m 0.3%
Australian Corporate Calendar
JB Hi-Fi Ltd (JBH.AU) Interim 2012 Results
Leighton Holdings (LEI.AU) Interim 2012 Results
Bradken (BKN.AU) Interim 2012 Ex-dividend date
Coalspur Mines Ltd (CPL.AU)* Interim 2012 Results
Western Areas NL (WSA.AU)* Interim 2012 Results
NOTES:
1. Check the ASX Dividend & Reporting section in the Member area before trading.
2. Prices may change as this Technical Analysis report is written from 3.30 – 6.30AM
3. Always think things out for yourself, we are only here to bounce ideas around.
Good Morning & Good Luck!
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