EURUSD and GOLD short term opportunities

 As mentioned yesterday at 1,2940, a triple bottom formation in this pair together with a break of the downward sloping trend channel would imply a bullish move were to be expected. Next resistance at 1,3010 area for EURUSD  a target that will most probably be hit today. Bulls don't want to see a pullback in EURUSD below 1,2930. A break above this resistance and a close above it for at least an hour will open the road for a move towards 1,3050.

Gold on the other hand has not made a break out yet. We expect prices to break above 1720 and give 10+ dollars higher. Our first target is 1730$ without canceling the possibility of higher prices.

I hope this short term update helps you with trading. Have a nice day and thank you for taking the time to read my thoughts!

German DAX daily update

Today we take a look at German index DAX. At first glance, the index trades still inside the upward channel. The sideways movement from mid September until now looks corrective. The index has most probably bottomed around the 7100 level right on top of the channel boundaries. An upward move is most possible if support level and previous low at 7095 is held. The move from recent high at 7447 looks impulsive. This is the only worrying sign looking at the chart. This decline might be the start of a bigger degree move downwards towards 6750 and why not lower. 

Concluding we have to be cautious at 7095 level. Chances are now in favour of a bounce and a retest of the highs. If support is broken, then prices could decline sharply lower.

If you need help trading this index or understanding my charts, don't hesitate to contact me.

Thank you for taking the time to read my thoughts!!!

Increased chances of an upward bounce in DJIA

Recent price weakness has pushed the index lower towards 13000. Prices have been supported at the lower pitchfork support. Prices are expected to bounce higher towards 13175-13225 resistance. Unfortunately our bullish expectations have not been met and prices fell below short term support levels and pushed the index outside the upward sloping trend channel (chart below). The market is expected to bounce from around the 13000 price level (38% retracement). 

The main bearish scenario puts the index in the start of  a large degree downward impulsive move. From 13661 high, DJIA has moved impulsively lower and according to Elliott waves it is in wave 3. Wave 3 follows all the necessary rules. It is stronger and bigger than wave 1, it consists of impulsive subwaves. For a bigger degree impulse to be complete, the 4th wave should not overlap the low of wave 1 at 13296.  If this scenario of a complete 5 wave downward move comes true, then bulls will find themselves at a very difficult position as much lower correction targets will be confirmed. 

So what now? Bulls will want the index to bounce upwards from this 38% retracement level and move past the low of wave 1. Price action will again show us  which scenario will prevail. Bears on the other hand will try to push prices lower in order for a complete 5 wave pattern from 13661 to be complete.

Thank you for taking the time to read my thoughts.

GOLDen opportunity or just a pause in downtrend?

 It has been some since our last analysis regarding GOLD. After having broken the support levels at 1770$, Gold has reached the 38% retracement  area. According to our bullish wave count this could be the area where wave ((4)) or part of it (wave A) ends. Although many believe that Gold has started a new downtrend with the first impulsive wave being the decline from 1798 to 1700 area, we give more chances to the bullish scenario. Nevertheless we always take into consideration the bearish view as it is valid and with good chances of confirmation.

Taking a closer look at Gold, the 1 hour chart shows us the resistance levels and the downward sloping trendline that need to be broken in order for gold to  bounce upwards. For more help in trading gold don't hesitate to contact me.

Thank you for taking the time to read my post.

S&P update: Where is the market heading?

The market has reached a junction where a big move in either direction will soon be clarified. Prices have fallen hard the last few days moving below the low of 12th of October cancelling several bullish scenarios and reviving the bearish ones. Our last call was at 1460 for a top as the index had reached the upper pitchfork resistance. After breaking the middle pitchfork support, the possibilities of a wave 2 have been diminished.

Looking at the daily chart above, my first reaction is that the market is seen to move sideways between 1420-1470 with no clear impulsive formation. The index still trades inside the upward sloping trend channel from 1260 area and has just touched the lower channel boundaries yesterday. Another bullish sign is the daily candlestick that was made yesterday. We feel confident that the market will rise and resume the upward trend towards the end of the year. However price action is our guide and prices need to overcome 1440-45 and 1470 resistances in order for the bull trend to resume.

Taking a closer look using the 60 minute chart of S&P we observe how prices were rejected at the upper pitchfork resistance at 1464. Yesterday the market bounced as prices touched the lower pitchfork support. Resistance lies at the middle pitchfork. Bulls need to move prices above that level and break in the process the 1440-45 level upwards. Bears on the other hand want this decline to continue with a move below 1415. Even if the market bounces upwards from this level, bears will still have a chance to take lead again at 1440-45. 

Concluding we concetrate on two price levels. 1440-45 is the first price level that bulls need to break for the continuation of the uptrend. The second important price level is 1420-10. Bears want a close below this level for downtrend to accelerate with targets towards 1300-50.  

Thank you for taking the time to read my post.

EURUSD bullish wave count

We start the week with a bullish wave count of EURUSD as posted earlier through twitter. We believe that the pair as long as it stays above wave i (1,2994) then our bullish count will be valid. Moreover the green upward sloping trend line provides support at 1,3010 area. We expect the pair to rise towards new highs above 1,3140. Regarding the short term 1hour view, we want the pair to break 1,3066 recent high in order to approach 1,31 resistance.

Is it time to buy SPX again?

LIVE UPDATE : SPX has turned downwards as expected from our previous analysis. From 1464, the index is trading near 1433 levels right now. We were expecting this decline as part of wave 2 of the larger upward movement we expect to see from next week. Our stop level is very close, at 1425 and our risk return ratio very low. Bulls would want the index to start climbing again firstly above 1439 where the middle pitchfork is now our resistance. Bears on the other hand are looking strong since the index has fallen more than 61,8% of the upward movement from 1425. The battle between bulls  and bears will very soon have one winner. The market will break 1470 and give prices above 1500, or the market will break 1415-1400 and give prices towards 1300. We believe in the first scenario as most probable, but we trade according to what levels break...upwards or downwards. Selling near resistances and buying near support. Thank you for following and I hope our analysis proves helpfull.

S&P confirms bulls strength

 Last time we analysed S&P, the index was near the 1430 level and we were expecting an upward move towards 1450. The index at the beginning of this week started to move higher in an impulsive pattern. We favoured the bullish scenario that a new upward wave is starting that will give new highs. The index closed yesterday just above 1460 showing that the bullish strength is dominating. This is most probably the 1st wave of a bigger upward movement rather than part of a corrective wave. However I think this 1st wave has pushed to its limits and its time to turn back down for a correction towards 1440.

As shown in the above chart, the move from 1425 is still inside the upward channel. Once broken the correction towards the middle pitchfork support will begin. Initial target is 1440 or 50% retracement. Of course for our bullish scenario to remain valid, prices should not fall below 1425.

Zooming in the 1 minute chart we observe the impulsive pattern this move has taken even at such a small time frame. The upward sloping trendline remains intact. Once broken, the correction may start towards 1440. First stop will be the area of 1454-50 as wave A and will be followed by wave B and C. Until then we have lots of time to calculate other potential targets of the expected wave 2. The form this correction will take when prices unfold, will make us more accurate regarding the correction target of this wave. 

The above analysis is based on our favourite bullish scenario that we propose and support for some time now. Bears were proven weak as important support levels have been held. On the other hand selling pressures were not strong enough. What the market has lost in 5 sessions, it has taken it back, almost 100%, in just 3 sessions. Nevertheless, bulls should be cautious at these levels and specially if 1425-15 area is breached. 

Thank you for taking the time to read my post.

S&P in new impulsive wave or countertrend bounce?

S&P bounced upwards in an impulsive pattern. From 1425 a  5 wave move completed at 1440. The most probable wave count is depicted in the 10 minute chart. Alternate 5 wave counts exist, that give higher targets for the completion of this upward move. 5 waves are followed by a 3 wave countertrend move and another 5 wave move towards the direction of the first 5 waves. Many believe that the market has topped and a new downward sloping trend has started. If this is true then wave 1 down has ended yesterday at 1425 and is pulling back upwards for wave 2. Yesterdays impulsive upward move could very well be wave A of 2. Practically this means that a small decline towards 1435-30 is expected and another up move towards 1450 will end corrective wave 2. Our analysis gives more chances that at 1425 we have seen an intermediate bottom and that a new upward move is starting. For this scenario to be confirmed we need impulsive waves upwards to continue and resistance levels at 1460 to be broken. The market has reacted at the area we expected the downward correction to end (red scenario of A-B-C in 60m chart). The blue scenario depicted in the 60m chart is the bearish least favourite scenario. Short positions should be considered after wave 2 has ended near 1450-60 resistance area, with 1470 as a stop. This bearish scenario will be confirmed if resistances are not broken and if the market moves downwards impulsively and breaks 1420-10 support.

For more help trading this index don't hesitate to contact me.....thank you for taking the time to read my post.

EURUSD expected higher

Although EURUSD has opened lower today, it is now pulling back up according to our most probable wave count. 1,2950 is important resistance that must be firmly broken. At least one 1hour  candlestick should stay above that level for the pair to continue its rise. A 5 wave impulsive move has been followed by a 3 wave corrective move that bottomed at 61,8% retracement. Next move was expected to be upwards. A confirmation of our bullish view will be the strong push through of the 1,2950 area. As long as the pair stays above 1,28 bulls will have the upper hand with the possibilities in favour of a new upward move at least towards 1,31.

Thank you for taking the time to read my post.

Bullish or bearish a pull back up is imminent

In today's analysis we post two charts of DIA (SPDR Dow Jones Industrial Average ETF) and DJIA as per the request of one of the blog's supporters. We hope our followers could take advantage of this analysis and that it will help them in trading.

DIA and DJIA are moving in parallel and price action is very similar to what S&P did. Although DIA and DJIA have made new highs at the beginning of October, their decline has been steep and impulsive. Our most probable wave count is that both ended wave C or are very close at its bottom. Both have reached the retracement of 50% relative to the last bottom (DJIA 13000 area and DIA 129,36). Even if both have made a longer term top in early October, price movement is expected to be upwards just for a decent retracement. The first signs that a pull back or resumption of the uptrend will be the break of 134,10 in DIA and 13428 level in DJIA.

 DIA is currently under the middle pitchfork. A break above it and specifically above 134,10 will commence an upward move that will try to reach 135 and then 136. Resistances are strong in the area 133,98-134,50. Support near 132,50-70 if broken early this week will push prices towards 131,50. We expect prices to bounce higher from the start of the week. If this does not happen then probably wave C is not over yet. But until which level can we label this as wave C? A break below the 131 level will be sign of extreme weakness. We can only be sure if  this is a C wave only if one of the extremes is broken(136.44 high or 129362 low).

 DJIA is also trending downwards with our most probable scenario being that we are in wave C. DJIA closed right on the 13330 support level. Wave C might have finished or will soon be. A break above 13400-430 will confirm that the move from the early October top has finished. We believe that a new uptrend will begin. Our bearish alternative is that once the move from the 13661 top is finished, we will see an upward retracement towards the 13550 level and the downtrend will resume. In either case an upward push is expected soon.

Concluding I would like to point out that being short at these levels should be treated with caution. If the resistance levels I mentioned break, the upward move could be very strong as I expect a new upward wave to start. If the market bounces as expected by our analysis early this week, but finds it difficult to move above resistances during the next weeks, then it would probably be wise to go short with a stop placed at the early October highs.

Thank you for taking the time to read my post and I hope it helps you with trading. Feel free to contact me if you have any question.

Has S&P started a correction towards 1300?

Today's chart is an updated version of a previous post. We take a look at some warning signs that a top has been made at 1474 and what to watch out for. As mentioned before and noted on the chart, each market rally from March 2009 has been smaller than the previous one. That could be a sign of weakness. Bulls are losing their momentum and power to keep the market rising for longer time and higher prices. The decline might not yet look impulsive, that is why we favour the scenario that we are still correcting the 1397-1474 move. If however support levels are broken, we could probably be starting a larger degree correction. The 1406 price level should hold on a weekly basis in order for bulls to still be in charge. If that level is broken, bears will take control and most probably lead prices towards 1300. The weekly close low of 1278 if broken, will signal the end of the continuation of higher highs and higher lows. Concluding we expect the market to trend again after or near the US election date. We give more chances to an upward move towards 1550 specially if prices don't fall below 1406. However we must also keep in mind the possibility that the trend changed to down after the 1474 top. This scenario will increase its chances  if support at 1407 is broken and if impulsive downward waves are seen.

For more detailed analysis on S&P we will update soon. Thank you for taking the time to read my thoughts.

APPLE and Facebook update

APPLE has made a short term bottom at 623$. In a previous analysis we mentioned that a break under 655$ could lead lower to 620 towards. Prices moved intraday towards that level and closed marginally above the 635$ support. Despite having broken the longer term upward sloping trend channel, APPLE will at least try and come back inside that channel. A move towards 655-60 is expected. At the 660-68$ area, resistances will put the stock to the test. If broken upwards, then the longer term upward trend could be safe. If not, we will have witnessed a back test of the broken trend channel with targets towards 600$ or even lower. Above 668$, we have 675-81$ as important resistances and then 705$. Support levels are found at 635-30$.

Facebook has most probably completed an A-B-C correction. We would favour long positions when prices move above the downward sloping pitchfork with the last important low as a stop. Prices have retraced 61,8% of the 17,55$-23,37$ move. If the prices are to turn upwards again, then it should happen very soon. 17,55$ low should of course not break under any circumstance for bullish scenario to hold. Our trading will begin as soon as prices break upwards from the downward pitchfork resistance.

Thank you for taking the time to read my thoughts!!!

S&P breaks support and continues correction.

S&P unfortunately for bulls broke support levels yesterday and confirmed our fears regarding the absence of an upward impulsive pattern. It was fine as long as the prices were above support, but after 1450 was broken, we knew from our previous analysis that next stop was 1439. So what now? The break of the support levels means that the correction of the entire upward move from 1397 to 1474 is not over yet. It is just going to get more complex than initially expected. 

A bounce back towards 1450 could be the case today, but I feel that 1430 is going to be tested once again. Middle pitchfork support could be the target of the end of this correction, but if broken the price targets will be lower towards 1430-20.

Concluding, our longer term bullish view has not changed as long as the index is above 1397. The correction we are in, counts best as the wave count shown in the chart posted. If you need help understanding my posts or need more details regarding my analysis don't hesitate to contact me.

Thank you for taking the time to read my posts.

EURUSD bullish scenario

Today morning EURUSD has hit exactly the 61,8% retracement of the 1,28-1,3071 move. As one can see in the chart we have posted, 5 waves up have been made from the low, followed by 3 waves down. The 61,8% retracement is the most common place for a correction to end after 5 waves. Bulls should be worried if the 76,4% retracement (1,2865) is broken, but will become more confident if the intermediate high (or wave B) is broken upwards. After a sequence of 5 impulsive waves and 3 counter trend waves, another 5 wave impulsive move is expected. As we mentioned last time in our EURUSD post, the bigger downward sloping trend channel had been broken at 1,29. It coincided with wave 2 that back tested the broken channel. Then a rally followed towards 1,3070 where the move ended 5 waves up. This downward move should stay above 1,28 since according to Elliott wave rules, it cannot be a correction and at the same time move past the start of wave 1. The pattern up to now makes us confident that the upward trend will resume soon. 1,28 level should hold at any cost although initial warning signs will be given if the 76,4% retracement is violated.

Thank you for taking the time to read my thoughts.

European indices will end correction soon....

 European indices have been moving sideways in a corrective pattern for the last two weeks. DAX may be forming another triangle to be followed by another push higher towards 7550. Support levels at 7150-100 still hold and the index trades still inside the longer term upward trend channel.

 Eurostoxx has a similar pattern with DAX. Support levels have been held, while the index has made a corrective pull back. Longer term momentum remains upwards with target just above 2600 where the middle pitchfork resistance will put bulls to the test.

IBEX has been in the centre of attention due to the financial aid Spain may or may not seek from ECB. Prices have moved sideways to form a triangle that we are expect to be broken upwards with targets near 8150-8200level. The index is trading around the middle pitchfork and it will have a difficult task ahead because that area is not only a previous top, but also a longer term downward sloping trendline connecting previous tops. 

Bulls should expect a move towards new highs or at least a double top in the next two weeks. However they should be on high alert if support levels are broken, because this upward move could end anytime now.

S&P double top

Friday saw S&P open near the September highs and reach 1470,96. A double top was formed as prices could not overcome that resistance level and were rejected. The market pulled back during almost the entire session towards 1457 and closed at 1460. We may see a back test of the broken downward trendline at 1450 or the pitchfork support at 1455 will prove stronger and hold prices. We are still upward biased. Critical support levels are expected to hold and new highs to be made during this week. The wave structure is not a clear impulsive move but could very easily develop into one. Support levels at 1450-39-30-20. Resistance levels at 1470-75.

Thank you for taking the time to read my posts.

Will AAPL fall from the tree?

Revisiting AAPL, price movement has reached important support levels as noted in several times from my twitter account to followers that a bounce at least was imminent. The stock price bottomed right on support at the 650$ level and bounced right back up to close that day at 661$. The price reached 671,86 (at least +15$ profit from our alert) and is now pulling back down towards 660$. A back test of the upward sloping trend line could be the reason. This is our bullish and most favourite scenario. On the other hand bears will try to break support levels that will open the road ahead for a decline towards 620-10$. All in all, we could be at the start of  a new upward move above 700$. In order for this to happen the price must stay above 650$ and break resistance at 681$ and 702$.

Thank you for reading my thoughts and for any more information don't hesitate to contact me.

Athens General Index rises amidst merger rumors

Following our previous bullish analysis of the ATG (http://profitablerisktaking.blogspot.gr/2012/09/blog-post.html), we find the index amidst rumors of impeding banking mergers. The move from 580 looks impulsive, however we have to be cautious as the 4th wave (triangle) has ended and we break out on a final 5th wave. The entire upward move could be in danger of an abrupt end as this could very well be part of a larger upward correction. For now we know for sure that our initial targets above 800 have been met. This is not an indication to go short, but and indication to raise stops. The possibility of this upward move continuing into a larger impulsive move and a longer term trend change are equally possible with the negative scenario. If you need help trading in the Athens stock exchange don't hesitate to contact me.

Thank you for reading my thoughts.

S&P update

S&P is progressing upwards according to our analysis. Having made a potential intermediate term bottom near the 61,8% retracement, has closed yesterday at resistance level of 1450-55. The pattern of this upward move is far from impulsive and that is my only concern regarding my bullish scenario. However if support levels are not broken, then bulls don't have to worry about anything. In pre market S&P futures are trading above resistance levels. Still my favourite scenario is an expectation for higher prices if support at 1440 is not broken. Next support level at 1425.

Thank you for taking the time to read my thoughts on trading S&P.

EURUSD update

EURUSD has been trading above the declining channel that has been in for the last two weeks. Until now it has made three waves up. This is a characteristic of corrective waves. 1,2877 level should not be broken for bulls to have any chance of further rise in prices. The pair could be making a smaller degree wave 1-2 upwards and that is another reason why it should hold the intermediate low. I believe it has more chances to unfold as an upward impulsive move, because the decline from 1,3170 looks corrective with all those overlapping waves. Moreover EURUSD has also made a back test of the broken channel today without breaking the important support levels at 1,2877. A break below the upward sloping green line will be very bearish as this is the channel line from 1,22. 

Thank you for taking the time to read my new post.

DOW and S&P intraday update

Last week I mentioned in my posts that bears should be very cautious as the decline from recent highs in the markets looks corrective and the upward trend will resume once again. Today's charts show us what we were expecting last week. The end of wave C down. In the S&P chart, the 5th wave down of corrective wave C ended higher than the wave 3 low in a truncation. This is the first signal that the downward move from 1474,51 is corrective. DJIA on the other hand managed to make a new low and finish wave C with 5 clear downward waves.  In both cases bears would start to count this decline as an impulsive wave (red wave count in first chart). However today's price action cancels any chance of an impulsive downward move since all waves are overlapping. So new highs are expected as mentioned many times before in this blog. The decline is corrective and found support at the previous 4th wave according to wave theory. If you need more help with trading this indices, don't hesitate to contact me.

Thank you for taking the time to read my thoughts.