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Monday, October 27, 2014

Market Report: Has The FTSE Put in a Major Top?

The strong decline on the FTSE over the past few weeks may have come as a surprise to many traders but for us it was expected. It really could not have gone any better for members. I have been warning members for a number of weeks to expect a strong reversal and a crash style move, although we have been preparing for a strong decline; members have also been trading the upside, as before members could trade the downside we needed to see the 6900 area tested.



Short term we can count a 5 wave decline from 6904, so that's a positive sign for the bears, currently we are looking for a corrective bounce in 3 waves to end around 6400-6500. Once any corrective bounce and retracement of the prior decline is finished. We are looking for the next leg lower, that move is expected to exceed 6000, if it's as aggressive and bearish as I think it will be, it's going to be a terrific trade and better than the initial decline from 6904. Our risk point at this stage is 6904, which is too large, so we are looking for evidence of the next leg lower.
The key now is the make sure any retracement is in 3 waves, if so then we will be looking to put on shorts and advise members to sell this market, if it's really put in a long term major top we are expecting a serious decline over the next few months and potentially retesting the March 2009 lows again.
As always the long term ideas are subject to revision as a lot can happen between now and a few years out, but as our primary focus is on the short term charts the long term charts usually take care of themselves.
If this style of analysis is the sort of analysis that you are interested in, then I encourage you to check out our site, if you need to know what is likely to happen before it happens then I think our work can help you, no matter if you are an investor or trader.
Until next time,
Have a profitable week ahead

Saturday, October 18, 2014

Elliott Wave Analysis on USD/SGD

A pair that i track closely for clues on the DX momentum, is USD/SGD, although we don't actually follow it regularly over at wavepatterntraders.com, it is a good proxy for the US$ movements.

You can see that its stalled a bit over the last few days, i suspect its a triangle, so once its finished we should see more upside and "thrust" higher towards 1.1283 - 70 to end wave [v]. As USD/SGD moves higher so should the DX and USDCHF.

So by using other closely correlated patterns we can get a strong opinion now on what the US$ should do over the week ahead.

The price structure on both USD/SGD and EURUSD is very corrective looking and supports the idea that once they are both finished the US$ should resume higher. Which fits in with our thesis that as EURUSD moves lower, the DX and USD/CHF move higher.

Sunday, October 12, 2014

Elliott Wave Analysis of Coffee (JO)

Back in April I issued a couple of warnings on StockTwits that a significant pullback was setting up, I was targeting the $32.00 area, which around the 50% retracement of the prior rally

See here: http://stocktwits.com/message/22165570

And here: http://stocktwits.com/message/22388553

As you can see those charts nailed the top and bottom near $32.00, virtually to the tick and that warning was very real. I noticed at the time that  sentiment was very bullish, which is usually the case when a market makes a 5th wave, yet those that understand price action were the ones trying to "get out" as most traders/investors were trying to "get in".

Such is the way with the markets, most are bullish at the top and bearish at the lows.

I am now issuing another warning for those that wish to listen. Sentiment is once again bullish and many are expecting the market to race higher, but i urge some caution here as a suspect this maybe a "B wave trap".

The move from the lows in Jul 2014 appear to have a 3 wave look, further more the measured move target where the 2nd up leg equals the 1st leg sits at around 43. Hence it could be a B wave of a flat pattern.

If the market finds trouble at 43 and we see a strong reversal back under 37.00 I fear traders will again buying a bull trap just as they bought the Apr 2014 highs only to see it crash 50%.

In order to confirm a strong 3rd wave to the upside, the bulls need to see a strong gap up over 44.00 and blast higher, failing that i suspect the bulls maybe disappointed.

A bit of patience here could save you making a big mistake buying the market.

If a 3rd wave to the upside you will have plenty of time to get on board as there will be plenty of upside.

Sunday, September 28, 2014

Elliott Wave Analysis of JPM (J.P. Morgan)

I have been monitoring this stock for a while now, the thing that stands out is the remarkable similarities between now and the rally from 2002 - 2007. Its almost like a twin of the prior rally, if thats the case we can expect some fireworks soon as this is now hitting both time and price fibonacci targets.

Lets take a look at the time equation aspect. its overshot the 86 months cycle date, but still inside a small cycle date of a poss 45 months cycle high, whilst price is the arbiter of any analysis its pleasing to see that we so have some potential symmetry in time, as well as price.

Lets look at price. We can also see that we currently have a 3 leg advance from the 2009 lows, price has just hit the measured fibonacci target where [C] would equal [A], thats important as a common target for a Zig Zag correction is where wave C would equal wave A, the next common fibonacci relation should be where wave C = wave A x .618.

If we take a look at a possible wave count, its could be at an interesting junction, if the move from 2007 - 2014 is a repeat of the rally from 2002 - 2007 then we potentially are on the cusp of a reversal.

Lets look back at this idea in a few months.

Saturday, September 27, 2014

Elliott Wave Analysis of Gold (GLD) (Update)

Update to this post http://wavepatterntraders.blogspot.com/2014/09/elliott-wave-of-gold-gld.html

Currently the market appears to be in wave 3 of [5] (alt idea is in wave D of the triangle). A closer look suggests its in a smaller degree 4th wave, so a bit more downside is needed to complete wave 3. My guess is around 115-116, then set up for a rally back to 120 before continuing lower towards its long standing target of 110.

Based on some of the Gold stocks and Gold stock indexes a great buying opportunity is setting up. Sentiment is at its worst, no one is interested in this sector, yet we are are looking forward to getting long the metals and Gold stocks. we like to "buy em when no one wants em".

Contrary to what others think, we simply follow our script and look to get members positioned for the moves, Forget what the perma bears are saying, the trend is likely coming to an end soon, and a great opportunity to buy is at hand for those that can control their emotions and ignore the "noise".

Whilst everyone can fight amongst themselves we at wavepatterntraders.com will be getting members ready for the rally that is going to setup and surprise most traders.

The time to buy is when no one is interested, Elliott Wave is not perfect, but its closest thing i have found to perfection and a great tool that if used in the right hands is a tool we can use to get positioned BEFORE the move.

Interested in getting positioned before the move and making $$$.

Take a trial here: http://www.wavepatterntraders.com/