Mercury

Looking for a small scale 1-2 retrace before the Bearish Phase really gets going. Possibility of another test of the overhead resistance trend line (i.e. another leg up). A break below near term support should trigger the Bearish phase in what is either going to be a wave B of an overall counter trend move OR a wave 2 of a 1-5 motive move that bring up a fresh ATH and probably the end of the Bull.

After a retrace bearish move GBPUSD is coming up on a couple of key resistance levels. A break of the top one would result is not that much resistance until about the 13200 level. Supporting this is the EURGBP breakout to the Bearish side in play as I write. Long term prognosis remains unchanged.

Looks like Brent has reached the zone I though might be a wave B after rejection in the first resistance zone with small scale NMD and a credible EWT count to signal the end. Of course the retrace might have already ended and a break of the key support around 5925 or thereabouts would confirm this for me. In the meantime the market is rallying off the Fib 76/78% related support and potentially setting up for a strong rally, quite possible aligned to FX pair rallies against the USD. We may be in for a period of USD weak, Commodities rally (I'm specifically referring to industrial commodities like Oil and Copper rather than precious metals, which are also influenced by the Greed/Fear sentiment equation and their own intrinsic market player sentiment. In addition to all that there was strong PMD at the recent bottom, which may still hold sway, and there are 3 price gaps above that could yet be closed before this market resumes it long term course down.

Nice move down through the 1 hour potential ending diagonal (or channel) followed by a couple of failed retests, the second one being right on the Fib 50%, before this pair fell away to now test the Daily chart larger channel support. A break here, after a small scale 1-2 retrace should bring up a move down to the next support level. Medium term I expect another reasonably significant retrace before the Bear really gets going. A rejection on the channel line will suggest another retest of resistance (or maybe another leg up) but those are scenarios 2&3 respectively for me at this point. Let the market decide...

Spidey-sense seems to be working. Silver has put in a decent Bearish drop, Gold also but less impressive. However now we are getting a potential reversal into a rally. There is PMD; and credible 1-5 wave pattern down to the turn (probably wave A) followed by a small 1-2 and rally. There is an unclosed gap around about a retest of the previous channel breakout zone. I am expecting a strong rally in wave B (opposite to that I see on stocks!) before another bearish move to finish off the retrace. Gold should do something similar.

Looks like the wave A (or possible 1) has concluded. Might expect a bearish period to bring up a wave B (or 2) and then another rally. Similar set ups on all the major stock indices.

COT is Commitment of Traders. The US Commodity Futures Trading Commission produces this data every week. It is based on CoB each Tuesday but published every Saturday. It basically shows the volume of futures and options Longs and Shorts split by market participant types and the net change week on week. I use the combined Futures and Options reports and am interested in the net Long/Short position of the non commercials. You can get data for commercials, non commercials and others. There is a lot of data in there but I focus only on the Commercials and Non Commercials. The Former is industry (e.g. Oil companies for Oil, miners for copper etc). For FX it is corporates seeking to hedge their businesses currency exposure in normal operations. The Non Commercials are the financial services organisations, many of them are trend following hedge funds. As a contrarian I am looking for when the Financials are overextended at a relevant turning point (based on my analytical methodology) and seek to go the other way on trading signals. This is a scenario supporting analysis rather than a trading trigger, which is why I referenced it as support for a major swing to counter trend on USD in my answer to you question. See link below to the relevant website. https://www.cftc.gov/MarketReports/CommitmentsofTraders/index.htm

I assume you were addressing the question to me @davidbrister, if you want a quicker response you should tag the person you are addressing, I look at the Forum infrequently as I am not a day trader. In term of a pull back, I see 3 possible areas if resistance (3 red lines) with a retest of my weekly channel line the most likely but price action will reveal this in due course. If Oil takes a bearish move temporarily then CAD might take a similarly bearish hit (i.e. USDCAD rallies) or alternatively USD rallies a bit before plunging. A break below the recent low, with USD going Bearish (see DX) would be the alternative Short signal for me, regardless of Oil movements. The main reason FX pairs are moving at present is that the USD is weakening (check my DX thread). This is a cyclical factor, regardless of news (which I don't follow, all to easy to say why something has happened but post hoc rationalisation is often wrong - Post Hoc, Ergo Propter Hoc!). I prefer to focus on price action and eliminate other noise, this is simply my methodology, news following seems to work for others - ya pays yer money the takes yer choice... Markets move in waves - fact; USD has been on a rally for some time and is simply due a counter trend move. This is about sentiment. If you look at the COT data you will see that a number of the key FX pairs were heavily bullish USD around about where the turn happened (EURUSD neg 112k and USDJPY neg 101k in particular). It is often the case that when the speculators (non commercials in COT terminology) are too extended one way or another the market turns.

Another leg up then and two 1 hour chart retests of my Weekly Triangle resistance line (see weekly chart). On the 1 hour chart I have a valid EWT count up to the second retest, which is being sharply rejected in this hour. A ST lower low would be nice and a break of the Daily channel line conclusive. There is good NMD on both the hourly and daily with Stochastic and RSI both over bought and breaking below. Are we about to see that EURGBP swing I have been tracking?

So the Dow did rally as I thought (see previous post) but it was not yet the end of the bearish move I was looking for as there was to be another leg down, as we now know, that ended with a small Gap last Sunday, which precipitated a sharp rally off the Fib 38% support zone (off the ATH). The rally was strong last week but what next? Markets move in waves so perhaps we can anticipate a retrace bearish move? But what about the medium term beyond that? Well for me it is shrouded in too many scenarios just now, therefore very uncertain as follows: The Dow could turn immanently and drop hard; Put in an A-B-C retrace, with that immanent turn being the A; Close that Gap above and either turn before the early May top; Or turn just after but still not post a fresh ATH; Or post a fresh ATH to join SP500 and Nasdaq. For me other markets offer stronger clearer set ups so I'm waiting for the fog to clear on stocks but will track all of the above scenarios in the meantime. Interestingly the Dax offers some more clarity, albeit the same outline scenarios as above on the Dow do exist. (see below my Dow chart for more on the Dax) Dax road map may hold insight for the rest of the stock indices If we take a look at the long term Dax Monthly chart a series of 1-5 up and A-B-C down moves are clear since the 80s. The most recent 1-5 bull phase was driven by the Central Banks interventions post the credit crunch, unprecedented QE and ZIRP/NIRP, which the Bulls seem to be anticipating will be restarted as a result of 1 poor US NFP reading (and this is supposed to be a strong economy..??). All the signals point to this bull market having ended in Jan 2018 on the Dax, but in this crazy market one couldn't 100% rule out another higher high, yet. At present though I think we have seen the top on the Dax and are now already in a long term Bear market that is simply retracing just now prior to a major drop. I am projecting a drop in 1-5 form (a motive wave) but even if it is in a large A-B-C, setting up another massive Bull, it will drop a long way. Zooming in a bit on the Monthly I can see a potential Head & Shoulders that may have concluded in May (or could have another leg up). Either way the neckline is coincident with the long term channel line and a break of both of these lines, in an around the Fib 23% is an important moment for the Bear scenarios. Looking at the Weekly chart there is a shorter term H&S possibility and the more recent price action is perhaps more aligned to a wave A-B (pink) that would project to a higher wave 2 (purple) retrace rally end, around about the Fib 76/78% off the Jan 2018 high. However on the Daily chart, and this is where the Dax gets interesting as a signal for other stock indices, the Dax has a strong channel formation, which was broken and is currently being retested. If the wave 2 (purple has already been posted then I would expect the channel line resistance to hold. It may get retested a bit later to complete a short term A-B-C to set up a big drop (scenario 1). If the line is broken though it sets up a new wave 2 (purple) turning point as mentioned above, which would pleasingly also close the current unclosed gap (scenario 2). On the 4 hourly chart you can see the potential wave A (blue) test of the channel line in close up. A possible small rally to the test point at the beginning of this coming week is likely. The form of the rally is 1-5, so an A-B-C Bearish retrace is the most likely next phase. There is NMD and Stochastic/RSI are over bought. I will not trade stocks until things clarify, FX and Oil is much more certain in terms of possible scenarios and trading set ups, but which road map scenario is followed on stocks in the coming weeks is critical to eliminating scenarios down to a few strong candidates. If either scenario 1 or 2 comes to pass we can expect a fair degree of whipsaw action, which is very dangerous to trade (unless you are a day trader and/or scalper, which I am not) so caution is required. At this point I would not be betting on a fresh ATH on the Dax, although we may see one on the US Large Caps while the European and Japanese markets retrace. For me it is important to track several related stock indices to get a better gauge of likely turning point than to just focus on 1. Let's see what the next few weeks bring in terms of clarity, meanwhile I am trading elsewhere.

The AUD has made a nice clean turn at a potential wave B offering me a couple of good Long entries. There is a chance of a deeper retrace off the pin bar on Friday but it was still a Bullish candle so more likely for me is a continuation and strengthening of the rally. As with GBP this looks like a wave C and if correct it will carry up with strength. My preferred target for retrace conclusion on this market is between 7600-7700 in the previous channel breakout zone. Convestion decrees that this market is not confirmed in rally phase until a breakout of the Triangle line but with other pairs and DX already broken through their respective lines I feel confident of my early Longs, not stop protected at break even in anycase.

Consolidating the view of the various USD pair into DX I see a clear confirmation of the Bearish phase I have been tracking. From the initial short term (1 hour chart) channel breakout (1-2 turn with NMD) to the down side the market has fallen is a nice 1-5 wave form to put in a quick 1-2 retrace that almost carried to the Fib 50% in a pin bar spike and drop. Another quick retrace to retest the Weekly chart Channel line with a failure and fast drop through support, now resistance. On the larger time frames you can see the Weekly channel breakout with a close below and NMD. At this point I anticipate a fast move down to complete a wave A and the the A-B-C that will be the mirror of EURUSD. Might get a short term retest of the recent support break (now resistance zone) and if we do that could be a good point to get short/long depending on the pair you are looking to trade.

This pair is confirmed in a Bearish medium term phase for me with a classic narrowing channel breakout and retest offering me a perfect Short signal. Subsequent price action carried on down quite fast breaking a Daily Triangle and now Weekly channel support line. A small 1-2 offered another Short opportunity, which I would have taken had I not be focused elsewhere. I expect this pair to move down in a fairly fast wave C now (watch out for a retrace flag at halfway). I will be holding my existing shorts and not adding but only because I see greater potential profits elsewhere.

Slow progress on this one so far but still heading up. EURGBP is still going up too and until this pair turns we are unlikely to see GBPUSD hammering up but when it does turn then I do expect GBP to go hard in a wave C to about the 13,700-14,000 level. Unlike EURUSD, which should conform to an A-B-C form retrace the A-B looks to be already done on GBP and a wave C is a much stronger move in general. The only thing I might expect to see is a strong Pennant or Flag at halfway, that would most likely coincide with EURUSD wave B. Very similarly to EURUSD I took Longs off the short term channel breakout and failed retest and again on Monday and Thursday last on failed resistance breakout retests. As this market offers more potential than other options I will be focusing my attention here to exploit the possible 1000+ points on offer in anticipated wave C.

Referencing the posts above at the end of May, "the trend is your friend, until the bend in the end". Swing traders (and longer term traders - I am both) seek to identify the wave changes both at the end of major trends and intra trend retraces. In this thread I have been showcasing just such an attempt (being an intra trend swing). It often takes many goes to catch it and requires a methodology that minimises both initial exposure and recognises a reversal fast to keep the cost of these attempts low (even to make some profits). The key is to lose small but ensure you catch the big move and both stay in and pyramid the hell out of it. I had a number of signals that suggested a turn may be once again on and posted on this at the end of May and the beginning of the week just gone. I managed to get Long around 30/31 May and go again last Monday and Thursday (see my hourly chart for specific trade points). My Longs are now all stop protected at break even. The thing I was really waiting for was a confirmed breakout of the Weekly Triangle. This is a trigger for me that the retrace rally I have been tracking for many months now is on. There have been a few fakeouts along the way but this one feels like the real thing (famous last words?). On the Weekly chart you can see a clear break and close above the trend line. The wave 1 (blue) turn occurred on strong PMD and 2 weekly chart pin bar retest failures (3 in total). This was all strongly Bullish to me and my 1 hour chart showed a deep 1-2 retrace to Brown 2 at the Fib 88% and turn with PMD and a rounded bottom form followed by a short term ice line breakout (this is where I took my Longs). On the Daily chart the weekly trend line breakout was followed by a hard retest fail with a long spike through the line and return back to close above. This will have cleared out those with stops too close (training or otherwise) and the resulting pin bar is a very strong bullish signal, coming as it does on that failed retest with a strong rally away. That was Thursday and then Friday added to the Bullish sentiment with another strong bullish candle. Overall I see this as a confirmed breakout and while I cannot rule out another turn and test of the weekly trend line the odds are favourable for a sustained rally (or bearish move on USD to be precise). A retrace tends to move in an A-B-C wave form so I am expecting to see this leading to a wave 2 termination, probably around 12,000 but lets see how price action progresses on that. After this I expect that big drop I reference in the title will be on. It is important to watch the price action on this as a wave B drop could take out lots of training stops, or worse cause losses for those too bullish. Trading a retrace requires a different approach to trend following, it is pure swing trading territory. The long term trend remains Bearish for me and while I am swing trading this retrace I am really focused on getting Short at the appropriate juncture to ride a long term wave down to the conclusion (again see prior posts on this thread for my views on where this could end up.

Pleasingly, Brent is playing ball in terms of my projected road map. This often doesn't happen on cue (well why would it?), being more a case of trial and error until it does trigger. However in this case I am holding Short for the long term and looking to Pyramid so not trying to catch the rally, therefore I don't care so much where and when it happens so long as it does. It is more about tracking the price action to ensure it is conforming to my long term set up, thus gaining confidence to both hold existing Short positions (all now stop protected at Break Even anyway so zero risk), and more crucially to add at the right moment. For me trading (long term trading) is not just about catching a good move but managing the positions in flight until the trend changes or my scenario is no longer valid, based on price action. Thereby I can maximise what I extract in profit from a good trend (crucial for the way I trade). I prefer to actively manage a trend rather that use trailing stops, which can, in my experience, stop you out of a good long term trend too soon (fine if you want to swing but I do not swing a long term motive wave). My long term prognosis for Oil remains that this market is heading South and in a big way. If I am right about this the I want to stay in for the long haul. The trick to doing this is to spot the relief rallies and protect or cash in near positions while holding earlier ones with stops well away from the potential retrace (rally in this case) tops. The anatomy of motive waves (or trends) is quite recognisable in structure and repeats this stricture fairly consistently. It is harder of course to spot the moves as they evolve in flight. So to recap on my road map (see the beginning of this thread for details), I believe the market to be in a final wave 5 of a long term Bear market. The big wave 3 is done and obvious on the Weekly/monthly chart. I believe the rally off the Dec 2015 low ($27.40) to be a wave 4 retrace (or counter trend rally) and therefore the current bearish phase is the final wave, which will carry below the Dec 2015 level. The turn and drop of the Wave 4 end (Oct 18) was a strong move consistent with a wave 1 and I am on record as expecting a strong counter trend rally once this completed, which we got to just short of the Fib 62% zone. A small 1-2 set up the current move down (a wave 3). There is an alternative scenario (as always), which is that the big move down to Dec 2015 was a very large counter trend bear (A-B-C) that is now over and the subsequent rally is a big wave 1 of a massive bull market that would carry back towards the previous all time highs. This is not a scenario I find credible at this point. However if this is correct then the current move will be counter trend (A-B-C) and the current bearish phase is a wave C, which would not carry beyond the 2015 low. Either way we can expect the Bear move to continue for some time and to go some considerable distance. All things being equal, if this retrace scenario is correct then I would expect it to carry at least to the 3800-4000 level (this is based on basic A-C equivalence in EWT theory), so I will be watching the progression closely to see if the move looks like turning in this zone. Otherwise I will stick with my lead scenario. Assuming my lead scenario is the correct one then I would expect the current move to be a wave 3 of a 1-5 that should end with a large and possible reasonably lengthy (in terms of time) flag or pennant. This current wave 3 should also show a smaller flag to mark the halfway point and this is what I think we may be seeing right now. I think it will close the gap I have noted before turning to resume its Bearish course. If it is a Pennant it will in all likelihood conform to an A-B-C form. Flags and Pennants are periods of consolidation and are often comprised or a lot of whipsaw price action so I will be waiting for this to resolve and show itself clearly before being tempted back in. If all of this is right then I would expect the wave 3 to carry down to the $45-47 area before we see another significant retrace, but that is all in the future, let's focus on spotting the rally turn to get Short with low exposure first. So that is a lot to take in but in summary I think the market will rally to about $65, chance of $66, price action will tell the tale. I am hoping to see a pennant or flag formation that will give me a breakout sell signal. This will set up a move that may carry to the $45-47 area before another, much larger consolidation, the breakout of which would see a new lower low (i.e. lower than the Dec 2015 - $27.4 area). The alternative scenario would see an earlier (larger) consolidation that signals a termination around about the $38-40 zone leading to a very strong Bull phase. The key to this for me is not so much to fixate on these levels, they are guides only, but the form of the price action to identify signals and assess the Elliot waves in flight. I will be looking to add to my shorts once I see a suitable retrace end and turn, if I somehow miss this I am holding several strong Shorts further up so quids in on those and I will wait for the next one.

So we did see a fresh higher high on the current rally but I remain unsure of this rally so long as it remains under the key resistance levels around that 1360 area. It is possible the last retrace is simply a pennant (albeit a big one) in a wave 1 rally that could terminate around key resistance and plummet back to close that gap. A clear breakout of the 1360 area is what I need to go all in Bull on Gold (or I should say resume).

The reason Silver is more attractive than Gold to me is twofold: It has not rallied as hard as Gold of late so offers more short term upside and less downside risk than Gold, relatively. In the past Silver has been seen similar moves to Gold but in a more amplified way. If you look at the 2011 commodities peak your will see that while Gold made nearly 700% gains Silver made 1100%. Maybe it is my Spidey-sense but I remain unconvinced we have seen a true breakout on either, despite recent higher highs. The rallies have been straight up, I will need to see a pull back or a breakout of a significant level, neither of which we have seen yet.

As I am seeking to Trade Silver rather than Gold I though I would open a specific Silver thread and cross reference to the Gold thread rather than post both on the same thread. To open this one I am going to go back to the long term set up before looking at the current situation. As IG do not hold very long term price data, and I like to have the whole picture, I am using long term charts from Macrotrends.net. If you haven't been on this website and like to see long term charts you should check them out on the following website address (note you can also download data, which I do to set up correlation graph analysis, often to debunk received wisdom such as Gold/Silver rise or fall contra to USD). www.macrotrends.net If you look at both the inflation adjusted and unadjusted (untick the log option) this simply puts an effective market floor around about $5.00. We aren't that far off this now. You will also note, from the unadjusted chart, that the whole market has posted a series of higher highs and higher lows, FWIW. https://www.macrotrends.net/1470/historical-silver-prices-100-year-chart I have a Quarterly chart that shows an expanding Triangle (some call a megaphone) since the late 1970s (around the time of the Bretton Woods removal of the USD from the Gold standard triggers a period of run away asset price inflation through runaway debt creation of money/liquidity). This chart shows Silver to be at a critical juncture right now. A drop through the long term supporting trend line suggests a drop to the market floor ($5.00). A bounce and breakout of overhead resistance suggest a rally, possibly to new all time highs. The expanding triangle might suggest that high could be in the $65.00 level, which would be consistent with a 1-5 long term bullish wave profile (there are some alternative EWT structures but as they all point to the same end I wont bother recounting them all). Additionally, if there is to be a deflationary depression and as the market crash that precipitated the last one (1929) took about 3 years to conclude the top of this market could (big could there of course!) be in 2022. But that is all just conjecture and not important at this point except to point out the potential for any risk reward calc. [See below chart for next level analysis] Looking at the Monthly chart, we can see the supporting trend line in more details with a lot of strong touches and prior pivots, which makes this a crucial line of support. The price action since Dec 2015 has been contained in a narrowing channel (or consolidation Triangle), which is fast running out of road, a breakout ought, therefore, to be imminent. There has been a strong case for a double bottom recently at 2 (purple) although alternatively this could all be an A-B-C retrace, but we don't have to worry about that for some time to come as both scenarios point in the same direction (i.e. up). Only a breakout of the Triangle to the down side negates a rally scenario. Very strong Positive Momentum Divergence (PMD) at the wave 3/C turning point in Dec 2015 set up the end of the prior Bear market (this is a trend change signal for me). [See below chart for next level analysis] Next up is the Weekly Chart and here we can see that consolidation in a bit more detail. The price action conforms to a so-called complex retrace pattern with a lot of whipsaw action but essentially still an A-B-C retrace to wave 2 (Purple) and that double bottom. That was followed by a rally to wave 1 (blue) and a potential turn at wave 2 (Blue) (see Daily chart for more detail). Again there was strong PMD at wave 2 (Purple). It is also noteworthy that the non commercials (or Financials) have consistently got the turns wrong during the consolidation (and before as it happens). This is a contrarian dream. The people who know these markets best are the precious metal specialists, i.e. the miners and refiners (so-called Commercials). They are the ones with the inside information on true supply and demand and the state of the industry. I always bet with the Commercials on Silver and Gold. Recently the Non Commercials turned very (relatively) Bearish, just as Silver bounced off critical support and rallied away. Was that the turn? Not sure at this point, let's take a closer look at the Daily chart. [See below chart for next level analysis] On the Daily you can the recent price action more clearly. The potential wave 1 (pink) rally off the Wave 2 (purple) double bottom turn has turned down again into another retrace. There was NMD at wave 1 (pink) after a 1-5 form rally. I was therefore looking for an A-B-C retrace move to set up a much stronger rally that would carry through key resistance. So far we have had an A-B-C to wave C (blue), with a good EWT internal form on all legs and PMD on the wave C (blue) turn. Additionally this turn occurred at Fib 76/78% and a possible short term Head & Shoulders neckline but just short of a retest of that long term trend line. Price has rallied up in a 1-5 form wave to the current point (wave 1 - green) and is stalled at overhead resistance and a parallel channel line. As with Gold we have a couple of pin bar rejections off resistance. At this point I would not be surprised to see a bearish phase but will it be a retrace to a higher low or a retest of that long term trend-line? Who knows? There are frustratingly at least 4 scenarios at this point, but only 1 Bearish long term, as follows: The market punches through the overhead resistance (Gold may be a good early indicator for this - see my Gold thread) The market does retrace to put in a small A-B-C to wave 2 (green) and then the rally really gets going. Another leg down to wave 2 (blue - repositioned) for a test of the LT trend line before that rally Bear breakout. Finally, let's look at the short term chart. [See below chart for next level analysis] On the 1 hour chart then I have a possible wave 1 (green) rally off the wave 2 (Pink) turn (same as Wave C blue). The form is a good 1-5, little chance of this being an A-B-C but you can never fully rule it out. Pin bar rejection off near term resistance and small A-B (brown). If this is all correct then the next phase should be down to retest support at 1450 or 1440 and then we will see what happens next. As with Gold, a break above the near term resistance (1510) suggest the rally is on.

Gold has arrived at an important juncture for me but before that looking at that I looked back at the long term charts to remind myself of the big picture. Unsurprisingly there are 2 scenarios (1 up and 1 down), actually a third which is continued consolidation (sideways) because in the big picture Gold remains in a long term consolidation Triangle, which is narrowing. This is significant as at some point Gold will breakout of this Triangle and that will signal the resolution to which of the 2 scenarios wins out. For my money it is scenario 1, a massive Gold rally in concert with a massive stocks Bear as Gold once again reverts to its historic role as a store of value in uncertain times, and do we ever live in such times..! Note under these conditions Gold can, and almost certainly will, go in the same direction as USD. So I am Bullish gold and given all the bullish chatter of late you might imagine I am happy. Alas I remain unconvinced of this rally and will not be so until there is a break of the previous high, around 1347, which we are very close to. Actually I really want to see a break of the upper resistance (LT Triangle line and potential H&S neckline breakout). The short term offers 2 scenarios as well: the first a break of that prior High and turn at 1347, the second that we are currently seeing a wave B turn back down to a final wave C bearish run of the EWT1-2 retrace and a test of the Fib 50% line (also Weekly chart Fib 23%) before the true rally gets going. I am minded to the latter unless or until I see a break of the 1347 high. Technicals: A-B-C retrace could be completed where I have marked Green A at 1266. A break of the 1347 high would confirm. If not then the retrace is a complex version and the market will turn before or at 1347 and drop in a wave C. The form of the rally is currently in an A-B-C, which is not motive, however a break of the 1347 zone will change this set up. There is an un-closed gap around the Fib 50% level. There is a pin bar and inside bar price action formation at the current market area, showing a potential turn once this is resolved. RSI and Stochastic are over-bought. There is NMD on the 4 hour and 1 hour chart at the pin bar high, although we could yet see another test of the 1347 level before this resolves. Note also that we have seen a reverse Death Cross (some call this a Golden Cross) but I would ideally like to see a cancellation of this and then a final cross to cement a rally. This will only occur if we get a big bearish move now followed by a wave 2 retrace turn into a very strong rally. I am not looking to trade the bearish move, I prefer to wait for the Bull rally triggers and prefer to trade this in Silver rather than Gold, the former having remained more subdued. Add to that the Platinum bearishness and I can't yet see a case for precious metals rally. I think we will see continued stocks bullishness for a while, albeit likely to contain a lot of whipsaw action rather than a rocket, which does not support a massive precious metals rally, yet.

Brent has touched bottom of the support zone and rallied away with a nice pin bar price action o the Daily chart. Not in and of itself a clear indicator but a pin bar is a sign of some Bullish support at that price level. The market has been quite Bearish since the second channel breakout and Bearish chatter has been building to the point one would be forgiven for believing the only ways is down (and I believe it is long term). However markets move in waves (zigzags) and I feel we are due a short rally. On the Technicals front I have the following: an unclosed gap up around the Fib 62% level (see 1 hour chart for close up). Actually there is another gap up at the Fib 76/78% level but normally I would not expect such a strong relief rally in a wave 3 but this is Oil so anything is possible... Stochastic and RSI over sold and momentum trending back up. Bottom of a strong long term support zone Short term PMD (1 Hour chart) Decent EWT count 1-5 down, now looking for an A-B-C retrace. Depending on the price action I will either look to add to my Shorts on a decent pull back and turn down and/or Short a break through of the recent lows. Price action will decide which of these and where. With a strong case for long term Bearish moves I feel fairly secure in Shorting but entry is vital to minimise draw down carry and exposure. FOMO is you enemy here. Longer term I am looking for an break below 5000 to cement the Bear market in and then it is a case of how far will it drop?

One hour chart is shaping up to back up the Bearish move I noted in previous posts. Nice mini rally off the ST support & failed retest of the recent breakout zone. Current move down is strong but there are several ST support zones to punch through before this thing really gets going. I would be expecting a 1-5 form Bearish move followed by a significant retrace on the Daily chart before the meat of any long term Bear takes hold. In my Triad assessment this would coincide with major Bearish phases for EURUSD and GBPUSD, just far worse for EUR. I have posted on my Fundamentals assessment supporting these scenarios previously in other posts but it can be summarised as follows: Big market meltdown - USD rally in flight to safety GBP balance of payments is bad, the UK needs a reset. This will come from Brexit freedoms and a lower pound driving exports but will take a few years, hence GBP down while USD rallies EURO is a basket case, essentially a basket currency with too wide a range of underlying parts (Greece to Germany and everything in between). The middle of the road economies such as Spain and Italy are heading south. There is no unifying central bank with a clear mandate and no government that can impact economic policy across the geography. Countries like Greece need to devalue to reset. There are too many subsidies and too much bureaucracy, fueling crazy situations like Greek government workers retiring on full pensions in their early 50s. Totally unsustainable $%!&fest. Cue meltdown triggered by Brexit perhaps or more likely more chaos on Greece.

Looks like this pair may just have ended a retrace move. It has been a sharp rally in favour of the Euro but at a minimum a short term bearish move is indicated, which could turn into that rout of the Euro I have been tracking. This is a contrarian position of course because naturally everyone thinks Brexit is inherently bad for the UK and therefore bad for GBP. I think neither and my technical analysis says so too, at least in terms of GBP, whatever about the other. The technicals on EURGBP show the following for me: Price has hit the Fib 62% and bounced back down Strong NMD at this turn point Decent 1-5 EWT count on the wave C Current breakout of the Daily chart trend line to the bearish side (not yet closed below) On the 1 hour there is also NMD and a small scale 1-2 retrace prior to the channel line breakout (unconfirmed) My analysis on the other 2 legs of the Triad suggest a strong rally for GBP followed by a stronger bearish move on EUR so this EURGBP move is consistent, which is why I track the Triad. The one watch out is a possible final leg up to test the Weekly chart channel that was broken back in early 2019.

The days break continued and turned out to be a strong one, always good to see this after a turn and break of an ending diagonal as it signals a trend change rather than a retrace. A continuation in the coming days will add to this. I forgot to mention the price gap in the support zone. Falls between the Fib 38% and 50%. In any scenario I would expect this gap to be filled and probably exceeded so perhaps we will not see a pause on this market until 6000 or so? Fib 50% is one of the most common retrace points, Fib 62% the most common one but I think that a break of the price gap support would be a bad omen for the hype Bulls (you know, the people yapping abut Bitcoin reaching $100,000 on the way up...).

Actually there are 2 short term possibilities, the A-B-C I mentioned in my last post and another leg down before a rally. That would make the recent short term rally a 3-4. A completion of the whole 1-5 could trigger a Flag or Pennant relief rally. A carry to the unclosed gap would be ideal.