Elliott Wave

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Elliott Wave

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US Gold CFD: 1650
Technical Analysis
TradingLevels: The resistances at Subgroup2 SG2 1665|1672|1680 are in place while the price retests the MediumLevel support 1650, I would expect the MediumLevel to be broken as part of a larger corrective pattern to unfold as the trend up from 1520 hasn’t been corrected, how far down will the correction come, the 50% retracement level is 1600 and there are supports in SG1 1610|1620|1630 so there is reasonable support to hold the price steady, we should consider 1630 and 1620, if the price does get to here we can look at the structure of the pattern and work out what’s next, simply by seeing if the first leg down is five or three waves. So yes a top is in place and now we need to see if the pattern down is going to be impulsive or corrective.
You can only short if the 1650 is retested and locked in as the resistance, with the view of adding to short further down , say under 1640 and exit at 1630 if 1620 becomes the resistance, then work the trade lower from their, we would need to see the US Dollar move up from its current five waves down, it should move up in three waves and abc correction and therefore Gold should move down in an abc correction
Elliott wave: An abc correction down to 1600? We need to see more of the structure if it does find 1650 as the retested resistance
Silver: The 30 support will be tested and probably broken, as gold didn’t move up enough to find support on 1672 so now a corrective pattern is unfolding down. Do hold long trades if the price moves under 30.00

Oil WTI: 100.50
Technical Analysis
TradingLevels: Oil’s pattern up from the 13th is much the same as gold’s, above the 100 the price pattern has overlapping wave structures so a corrective pattern is on the cards
Elliott wave For a bearish bias to start the price requires the 100 to be the resistance, short trades would start scaling in on the first or second failed retest of 100, the first retest would be a bounce off 99 back to 100 and the second retest from the first MinorLevel 98.00 this is the more important one from a technical point of view

Base Metals

US Spot Prices (in l/b)
US Copper: Last: 3.78+
US Nickel: Last: 9.10+
US Zinc: Last: 0.91+
US Aluminium Last: 0.98+
Copper CFD: 378
Technical Analysis
The main trend is up but we have to expect a corrective pattern at 380 back to 372.
US BHP will struggle at 80 (TL8) and the Australian Materials sector will struggle at its MediumLevel 15000 and the ASX touched on the overhead triangle trendline, as they say Risk On. Remember that the precious metals and Oil are about to correct and the US Dollar find its low after five waves down and the mirror opposite the Euro, US and UK Indices are completing their five Elliott wave up

Forex

US Dollar: 80.40
Technical Analysis
TradingLevels: I was expecting the Dollar to complete its five waves down into 80 then bounce in three waves, the Euro, US and UK Indices doing the opposite with their five waves up the down in to 12600 – 12650 the SP500 1310 -1320 and the LSE 5772 – 5800
The five waves down is a little complicated so also look at the CHF and CAD

EURUSD 1.2920
Technical Analysis
TradingLevels: The 130 is the brick wall, expect sharper sell offs close to this level, it’s also likely the 129 will be retested for a larger corrective pattern down from the 12950 back to the 129
Elliott wave The impulse wave up retesting 130 is extending and is complicated like the Dollar moving down, as you can see on our Euro chart the wave five is near completion.
Trading Strategies: European bond sales are lifting the price up, but I also think it’s got to do with the next ECB meeting which I think is on the 26 Jan a holiday for us in Australia

AUDUSD 1.04
Technical Analysis
TradingLevels: On the daily chart just like the ASX200 there is an overhead trendline from a triangle looking pattern that is casing the resistance the battle is at 104. As long as the price stays above the 10372 SG2 the market is bullish, under the 13050 is not a good look
Elliott wave Still considering the pattern at 104 a wave four once completed a push higher to 10472 - 105
Trading Strategies: It has been very messy for intraday traders, which can frustrate and deter, but keep in mind that the bigger the correction the better the next trend, don’t let it leave without you. If you are long look to add when the SG1 10430 is the support
1:30pm CNY HSBC Flash Manufacturing PMI 48.7

Indices

Dow Jones CFD 12,600
Technical Analysis
TradingLevels: The 12650 is about roughly right for the impulse wave from 12300 to complete. The 12772 and 12800 are the bigger numbers which of course is under the 13000 the Major TradingLevel, the 12800 is a profit taking number and the 12,772 a timing price point and the 12650 is a sublevel that always packs a unexpected punch.
But first things first, the Dow nearly always works to every 100 points so the 12,600 is where we are at, so corrective activity here.
Elliott wave I mentioned about counting five waves up from the 12300, however we can narrow that down, we can count another five waves up from the 12450 which is from the low of a wave four of the five waves up from 12300, so counting five waves up from the 12450 is what you need to do.
Trading Strategies: Give the price more time at 12600 and if you see a corrective pattern below 12600 then the price climbing back above 12600 then scale in through SG1

S&P500 CFD: 1315
Technical Analysis
TradingLevels: Resistance at 1320 and a possible move back to 1300 from the 1320, that said if the price finds support on 1330 the top of subgroup1 (SG1) which is also the top of Minor Group1 (MG1) 1300 then higher ground is on the way. That said, I think we are looking at the first high above the level 1300 which should run out of steam and correct across and below 1300 with support at 1272 SG2 zone
Elliott wave five small sub waves ending into 1320
Trading Strategies: depending on your degree of structure that you trade, but wait for a pullback in 1310 after this small corrective pullback if it can climb back above 1310 as support then trade long, if you trade MicroLevels then just work the level and read the volume play

FTSE 100 CFD: 5743
Technical Analysis
TradingLevels: Support is building above the (72) 5720 which is a long time coming, the 5750 Midpoint will play its part firstly as resistance then support with the higher targets of the 5772 and 5800
Elliott wave It can fail at 5750 so unless your trading longer term, exit now at 5740+ and wait for support on 5750
Trading Strategies: noted above

SPI CFD 4250
Technical Analysis
TradingLevels: The overhead trendline from the triangle pattern knocked the price back to support at 4200 and the second attempt is under way, this time the 4272 will come into play as the resistance this is SG2 4265|4272|4280 you need the 4272 as support for being long
Elliott wave Unsure.
Day Trading: 4250 as support for longs
1:30pm CNY HSBC Flash Manufacturing PMI 48.7

Technical Analysis

The catalysts driving the markets are buying the lows in China (SSEC) with the base metals being the fasted moving vehicle and the ECB meeting looking ever hopeful as European bond selling is actually happening, which actually is digging a deeper whole which in the end will take a wider circle of investor with it. I think the meeting is on the 26/1 so the markets can run to this date.
Back to the base metals which is the driver in Oz, I would expect a correction in Copper from the run its had up, the corrective pattern from 380 to 372 or 365 at the same time US BHP will struggle at 80 (TL8) and therefor the ASX Materials Sector XMJ will struggle at the MediumLevel 15000, if this is the case then this we reflect across our markets.

In this trend up, so the Dow, we can now starting counting five smaller waves from the 12450 which should take us near the 12650… I’m looking for the catalysts that can take our long trades safely higher… the China PMI figures are out today 1 pm and they are centrally important to base metals, the next is our Weekly Bullish Cycle, each day this week has done as expected, so we are looking for a stronger Friday close with Monday also being up. That said don’t over trade and use stops.

Trading Quote

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Today's Financial Events
Time Currency Detail Forecast Previous

11:30am AUD Import Prices q/q 0.6% 0.0%
1:30pm CNY HSBC Flash Manufacturing PMI 48.7
3:30pm JPY All Industries Activity m/m -0.6% 0.8%
6:00pm EUR German PPI m/m 0.1% 0.1%
8:30pm GBP Retail Sales m/m 0.6% -0.4%
11:00pm CAD Core CPI m/m -0.2% 0.1%
11:00pm CAD CPI m/m -0.1% 0.1%
12:30am CAD Wholesale Sales m/m 1.2% 0.9%
2:00am USD Existing Home Sales

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!