JWagnerFXTrader
Short

Multiple Patterns Suggest Near Term Sell Off Towards 1.0750

FX:EURUSD   Euro Fx/U.S. Dollar
2662 28 41
Multiple Elliott Wave patterns are lining up that suggest EURUSD             may fall towards 1.0750.

1) In the context of a medium term bull trend, an a-b-c expanded flat from Dec             3 points to 'c' of 2 to 1.0750, then a larger bull run kicking off

2) A wave 4 triangle suggests this move from Dec             3 to Dec             9 was 'a' of a triangle. 'b' of a triangle likely presses towards 1.05-1.06.

Much above 1.1048 and these shorter term patterns are hampered and see the December 4 post for a medium term analysis.

Keep a close eye on the Speculative Sentiment Index. It is a contrarian indicator and if begins to run lower than -2.0, then that might suggests this short term view isn't going to happen. It is currently printing at -1.6. You can follow real time S S I here.
Comment: EURUSD is still hanging out in the upper portion of the range. Real time Sentiment is holding near -1.48 https://goo.gl/B7HU4a . 1.1090 is the key level for bears and we can turn bullish there.
Comment: The wave picture has muddied a bit. We've fallen as anticipated, but the clarity of do we move in bullish or bearish fashion isn't as clear.

There is some minor support in this area (currently price is printing 1.0720).

Sentiment is growing more bullish which isn't good for a bullish trader. Current Sentiment reading is +1.1. Perhaps wait for resistance trend lines or horizontal resistance to break prior to testing bullish waters.
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kopparam kopparam
bullish deep crab
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Indeed - similar outcomes. Thank you for sharing Kopparam.
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Is it still valid?
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Yes, still active. Nothing material has changed since this was posted a couple hours ago.

"Much above 1.1048 and these shorter term patterns are hampered and see the December 4 post for a medium term analysis. "
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very very professional analysis. thank you for sharing. i hope to see your analysis more.
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JWagnerFXTrader PRO PooyaSalehipour
Thank you for the kind words Pooya. As time permits, I'll place an analysis in the TV community. Feel free to follow and that way the posts will show up in your stream. Thanks again.
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Thank you for sharing ... this is nice :)
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Your welcome Fiboholic. (btw, love the handle!)
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snapshot

well, once in a blue moon,
i get betrayed by the wick
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AMBRISH jangseohee
Wick act like wicked wick. it happens.
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I am a closet wicker...they really get my blood pumping when wicks occur near wave relationships.
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Thanks for the link to the SSI indicator!
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Absolutely, you are welcome! It is an excellent tool to have in the tool box.
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eurusd making its 5th wave of the first wave in ending diagonal and likely to top arnd 1.11(its making abc 1.1042 to 1.0925 as a wave then to 1.1029 as b wave now falling to 1.084 as c wave then will rise to 1.11 to complete the ending diagonal after it is likely to fall towards 1.06 in wave 2)
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tulasi, I'll have to admit I am more of a visual person. Would you mind sharing a chart with your labels so I can 'see' what you are describing? Thank you.
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Thanks for sharing, i admire you work. Good job.
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Your welcome Enigma...it is a pleasure to hear from you.
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It is really interesting but confusing to see many wave analyzers come up with different wave counts. I've seen 6 different wave count theories from different people :) Thankfully some of them brings the same result in the short term...
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Valid point - EW is probabilistic in that we never know what will happen...however we identify what won't happen. Said another way, anything is possible until it breaks one of Elliott's rules. Taking it a step further, the waves and patterns have behaviors, characteristics, or tendencies. For those guidelines, the waves tend to follow, but they are NOT rules and don't have to be adhered to.

What you are seeing with the 6 different counts are people's interpretations of the guidelines. If each of the 6 counts haven't broken any rules, then they are still possible. Some of the counts are going to be higher probability, but even the lower probability counts are still possible.

In the end, you hit on a SUPER IMPORTANT concept..."Thankfully some of them brings the same result in the short term..."

If there are multiple counts that point in the same direction, it becomes a trading opportunity. We can sort which was the wave count later.

That concept was the genesis of this EURUSD post...there are both medium term bullish and medium term bearish counts that point to a shorter term sell off. Therefore, a good risk to reward ratio exists towards 1.0750. That doesn't mean it will work out as profitable, but the risk to reward ratio is strong enough such that I can be wrong more than I'm right and still have a chance to grow the account. I don't know about you...but I'm wrong a lot and appreciate that grace!
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Sorry but the news of the Fed should be positive for the dollar ... you will appreciate these days?
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Hey Wagner, is that a valid head and shoulder pattern that I see on the chart above.

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Hi Moneymaking - my interpretation of head and shoulders patterns are extremely strict...therefore, take what is following with a grain of salt.

There are 3 pieces of structure I look for:
1) Symmetry on the time distance from the head to the left shoulder vs the distance from the head to the right shoulder
2) Symmetry on the height of both the left and right shoulders - I look for their height to be nearly equal
3) I look for a horizontal or slightly downward sloping neckline

Based on the 3 items, #2 and #3 are fairly clean. #1 is close. So it could be interpreted as a H&S.

Sentiment would support further losses in the pair.
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moneymaking JWagnerFXTrader
Thank you for the explanation mate, appreciate it :)
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I love your work keep it up. One question I am adopting the Elliott Wave principle to trade. I was going to do backtesting. Did you do backtesting when you was starting out with EW? Another question is regards to stop loss placement I am aware of where the SL levels are with EW trade setups but do you take into consideration ATR values or anything ? or do you just place the stop loss as an Elliotician for example in a ending diagonal you may place it after wave 5 or when wave 5 is longer than wave 3 etc ?
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Good question - I started with the higher probability ratios that could 'bail' me out if I'm wrong.

For example, wave 2 typically retraces 50-78% of wave 1. Well, if I enter near the 61-78% retracement area, place my stop loss below the start of the supposed wave 1, then even if price only makes it to the price area of the end of wave 1, I have a 1.5-3x reward to risk ratio.

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This assumes only getting to the recent swing high. If it is a wave 3 higher, then, even higher levels exist.

So bottom line, there are certain areas in the wave count where good RR ratios exist and I preserve the capital for those moments.
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stevendave JWagnerFXTrader
Thanks for sharing!!! Yes I have been looking at these ways to have the highest R:R
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