The Big Picture
The Wave Structure
The Wave Structure that I am presenting here starts on 2001-07-06, exactly 17 years ago, at the high price of $121.02. It was a 5 waves down followed by a 3 waves corrective structure. After which, we have a 5 waves down followed by a W-X-Y.
I want to talk about the last wave structure which I labelled W-X-Y. It is not an easy count to make. If you had gone into the daily timeframe, there is a chance that you will have the entire structure count as an impulse 1-2-3-4-5 as shown as the blue wave counts below. But having that count posts a problem for us: the circled area in the main chart actually breached the low of our red wave (2).
Thus the only valid and probable count we can have is that the last wave is an ending diagonal 3-3-3-3-3 where over-and-under extensions are acceptable variations without breaching Elliott Waves Rules. Take a look at the previous 4th wave (in green & purple) and you will see that the count is similar to how I have drawn the current W-X-Y wave.
2 more things:
1. Note that the last uptrend W-X-Y actually stops around the previous wave 4 and this is a textbook example for where a correction will stop.
2. On the weekly timeframe, we have candlestick reversal formation: A Graveyard Doji.
A Short Bias
To be honest, I have a short bias for USD. A very strong one. Without which I would have used the blue count above on the daily timeframe and missed the finer details available on the lower timeframe.
The Wave Structure
The Wave Structure that I am presenting here starts on 2001-07-06, exactly 17 years ago, at the high price of $121.02. It was a 5 waves down followed by a 3 waves corrective structure. After which, we have a 5 waves down followed by a W-X-Y.
I want to talk about the last wave structure which I labelled W-X-Y. It is not an easy count to make. If you had gone into the daily timeframe, there is a chance that you will have the entire structure count as an impulse 1-2-3-4-5 as shown as the blue wave counts below. But having that count posts a problem for us: the circled area in the main chart actually breached the low of our red wave (2).
Thus the only valid and probable count we can have is that the last wave is an ending diagonal 3-3-3-3-3 where over-and-under extensions are acceptable variations without breaching Elliott Waves Rules. Take a look at the previous 4th wave (in green & purple) and you will see that the count is similar to how I have drawn the current W-X-Y wave.
2 more things:
1. Note that the last uptrend W-X-Y actually stops around the previous wave 4 and this is a textbook example for where a correction will stop.
2. On the weekly timeframe, we have candlestick reversal formation: A Graveyard Doji.
A Short Bias
To be honest, I have a short bias for USD. A very strong one. Without which I would have used the blue count above on the daily timeframe and missed the finer details available on the lower timeframe.