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Can Bulls Rally From Wolfe Waves' 1-4 Line | #Forex $JPY $USD

FX:USDJPY   U.S. Dollar/Japanese Yen
jpy
1386 46 14
jpy
Traders,


PRICE ROLLS OFF OF WOLFE WAVES COMPLETION:

As forecast, price rolled shortly after hitting the qualitative target @ 109.786, defined last September 12th. As per its nature, this "Qual-Target" defines price reversals or retracements greater than the significant 0.618 Fibonacci reversal value. This significant decline occurred at the Point-5 position of a Wolfe Waves pattern ("WW"), where price also found support at this WW's Take-Profit line, defined by the extension of points 1 and 2.


PRICE HOLDS AT WOLFE WAVES' 1-4 PROFIT LINE; BULLS IN FORCE:

As current price nears a significant bullish entrenchment at the 108.651-to-108.815 range, RSI posts a potential Positive Divergence, one that is reminiscent to the 23-25 SEP range, which heralded the rallying in price sending price into its geometric             completion of the WW. This RSI signal is a much rarer and very telling indication of an imminent price movement, in contrast to its Bullish Divergence cousin.


RSI TELLS ITS OWN BULL AGAINST BEAR STORY:

Turning the analysis to non-price events, let us consider the RSI at this point, which tells its own bear vs. bull war story.

First, consider the back to back failures at its 70-Line, which occurred in the form of a double-top. This 70-Line failure alone is a signature of RSI , regardless of the double-top formation at that very same level. When you see this, simply cover your long position, as the internal mathematics of RSI indicates that buyers will be too weak to sustain a bullish venture.

Now, looking a the current price action, a similar event is occurring, where RSI retains a bullish stance as it hovers its 40-Line. In effect, RSI indicates that as far as this 4-hour timeframe goes, bulls and bears have stood their respective grounds, and bulls have NOT given up their intention to push further on up. A background MACD reflects a similar conflict, as its histogram has delved in negative territories while its moving average indicator remains above its zero-line - At this point, a net-positive outlook emanates out of these indicators.


PREDICTIVE/FORECASTING MODEL:

Prior analyses posted in TradingView using this model have defined loftier forecasts (see "Related Ideas" links below). However, in the interest of reasonable timeline, use of smaller timeframe submitted to the predictive/forecasting model suggest the following two targets:

1 - TG-Hi = 110.255 - 01 OCT             2014

and

2 - TG-x = 110.639 - 01 OCT             2014.


OUTLOOK:

For these targets to remain valid, the EAGLE range would need to be untouched (i.e.: price may cross but not close below the 108.651 to 108.815 range). Look at a significant bullish entrenchment at Points 1, 3, and 5 belonging to WW, which correspond to significant inflection levels in RSI , where the corresponding Point-1 at 109.365 would possibly impose the strongest resistance.


OVERALL:

Price behavior remains bullish . Model also retains a bullish stance with qualitative targets slightly above the recent structural high achieved at 110.081 yesterday. So far, price has reacted in the ipsi-directional side of the forecast, as it found support off of the Wolfe Waves' Take Profit 1-4 Line. Look for further discreet behaviors in RSI and MACD to confirm or infirm this predictive analysis and forecast.

It will be very interesting to see how the $SPY / $ES behave (i.e.: will it continue to decline, or reverse at their current respective price levels), considering that both have converted the model bias into bearish territories, despite a tight correlation that has existed between $SPY / $ES and $JPY. If anything, this is further proof that a significant bear/bull war is unfolding at these levels.

Cheers,


David Alcindor
Predicitve Analysis & Forecasting
Denver, Colorado - USA


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David Alcindor, CMT Affiliate #227974
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I have 2 thoughts -
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(higher probability expanded flat) - Fits also a Euro Correction and also dollar index needs a correction. and the other thought is
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(lower probability the expanding diagonal pattern is lower in occurance)
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4xForecaster PRO resurrector007
2 years ago
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IvanLabrie PRO 4xForecaster
2 years ago
Can it be an expanded flat with 5 waves as subwaves? I thought it couldn't be. 5 imp on 15m, doesn't that suggest a zigzag?
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IvanLabrie PRO IvanLabrie
2 years ago
5 waves down*
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4xForecaster PRO IvanLabrie
2 years ago
Hello, @IvanLabrie - An Elliott Wave's Expanded Flat would suggest two things:

1 - An internal structure arranged such that internal waves move in a 3-3-5 fashion. This would allow price to offer a succession of COR-COR-IMP moves, which the first COR identifiable as it moves AGAINST the prevailing trend.

2 - Wave-B would exceed the origin of Wave-A, and reverse into Wave-C, which would exceed the other end, or termination point of Wave-A (Waves A and C would thus move in the same direction to one another, but move against the major trend).

So far, the chart that @resurrector007 submitted suggest that the last three moves have submitted themselves to that internal rule (COR-COR- ...) and that a last IMP would be required, with an ending exceeding the origin of Wave-A.

So far, all bets are, but the COR-COR-IMP is close to being a reality.

Feel free to post your own chart and point definition, to illustrate what you are seeing.

David
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IvanLabrie PRO 4xForecaster
2 years ago
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That's what I'm looking at. I'll check out resurrector007's chart now.
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4xForecaster PRO IvanLabrie
2 years ago
@IvanLabrie - Not sure what to look for in the chart. I see two indicators below, a fan and an active trade software overlaid by a Fib scale - What was your question? David
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IvanLabrie PRO 4xForecaster
2 years ago
No trade yet, closed my short from 109.82 at 109.04. I was asking if the impulse right out of the 4h chart's top being a 5 wave run would imply a zigzag correction at this level.
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IvanLabrie PRO IvanLabrie
2 years ago
Heh, my original take on it wasn't that far off it seems. Dead on hit...except I wasn't short :/
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4xForecaster PRO 4xForecaster
2 years ago
@resurrector007 - Please, if you do not mind, use the chart posting icon in the top-right window of the space in which you typed your comments. It makes it much easier to share and see.

1 - The Elliott Wave's Expanded Flat is definitely an attractive proposition here, and one to keep under the elbow if and once price fails the current bullish outlook. Both $SPX and $#ES have turned bearish, and I am not familiar enough with their historical correlation in terms of which of them leads the other. So, if $ES is the leader, then $USDJPY will fall. If $USDJPY leads - which I am suggesting it might, based on its underlying bullish resiliency per indicators - then a rallying will occur, leaving many traders and investors holding the bag.

2 - The expanding triangle can be considered in one of two ways:

-- a) In its pure geometry, it is approximating the "speakerphone" outline, so that the outer contours are consistent with that geometry, and may call for the rallying you have delineated in the red arrow.

-- b) In its skeletal structure (i.e.: the internal waves), some Elliotician might contest that while Wave-1 is a corrective wave ("COR"), so would all other internal waves. I see that Wave-2 may be construed as an impulsive wave ("IMP"). I agree with the internal of Wave-3, as a complex zig-zag ("ZZ") can take on a 5-3-5 internal move as it progresses with a IMP-COR-IMP structure. Then, again, as with the case of Wave-2, here Wave-4 is failing to deliver a COR structure, as it seems to have taken on a IMP internal structure instead - Agreeing that all of this may become arguable with much more astute Elliotician out there, as I read the waves without such pretense.

Now, looking still at that same chart where the Expanding Triangle is defined, I would perhaps look to define some significance straight from the Point-3 defined in BLUE. Its subsequent move into Wave-4 looks to be a ZZ, whereas the following Wave-1 carries that ZZ pattern forward, thus defining a larger geometry approximating a Wolfe Waves pattern, or simply an Elliott Wave Ending Diagonal, perhaps.

I hope this makes sense. I very much appreciate your input here.

Cheers,


David
+1 Reply
resurrector007 PRO 4xForecaster
2 years ago
The expanding diagonal is ruled out now. Looking for a expanded flat. The target here would be between 108.100 - 107.600. I'm not to familiar with the various harmonic patterns - but they also work.
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IvanLabrie PRO resurrector007
2 years ago
Why would the expanding triangle be invalid? You need waves a-b-c-d-e...and they are there. Isn't it a long trigger in this case?
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resurrector007 PRO IvanLabrie
2 years ago
i need to brush up on the entry into the triangle ... also then review those count within to give you the answer.
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resurrector007 PRO resurrector007
2 years ago
yeah, the for expanded triangle pattern i think you have to go well into the details to see the counts and how you enter the triangle.
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4xForecaster PRO IvanLabrie
2 years ago
@IvanLabrie - it would act as a continuation pattern, so the points are correct. However, d-e looks like an IMP, when it needs to remain a COR - David
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IvanLabrie PRO 4xForecaster
2 years ago
So it looks more like two expanded flats, one after the other, after a zigzag in the other direction. Interesting...I'm looking at volume action with mt4 and seeing signals of stopping volume and no supply btw. 1h and 4h.
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resurrector007 PRO IvanLabrie
2 years ago
I think on your chart a = 3 , b = 5 (which cant be right), c= 3, d = 3, e = in progress. so if the b count is not 5 and is 3 then it is a potential.
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IvanLabrie PRO resurrector007
2 years ago
Yeah, based on what David said, I think that b is a smaller flat's c.
We're close to the low flat completion point btw. I longed too early, but well, gotta hold now.
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BBFX
2 years ago
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:-)
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4xForecaster PRO BBFX
2 years ago
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Please, use the chart icon in the top-right window to ease viewing - David
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4xForecaster PRO 4xForecaster
2 years ago
Are the points defining a potential Wolfe Waves pattern, or is this another pattern?
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BBFX 4xForecaster
2 years ago
Sorry Doc....yes WOLFE WAVE... I just like drawing in the Wolfes 'teeth'. Used to drawing triangles!! :-)
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4xForecaster PRO BBFX
2 years ago
Hey, Buboo - Did not recognized you. The position in Point-5 is likely a 5-prime or an Elliott Wave "Throw-Over", depending on what you are using. Very nice. David
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BBFX
2 years ago
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IvanLabrie PRO BBFX
2 years ago
I was looking at the same ting but the run from point 1 to 2 looked sketchy...interesting proposition though.
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BBFX
2 years ago
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H4 entry to BUY . That's what I have at this moment....nice to see you concur.. The Daily WOLFE at Point-5' should be where the big bears are waiting. Glad you introduced WOLFE WAVES to us here.... :-)
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IvanLabrie PRO BBFX
2 years ago
Indeed, this + EWP and RSI is a great guide. Luckily we have such caliber of a trader sharing his knowledge here (and for free I might add). Respect.
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fximperija
2 years ago
Don't see why not :)
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BBFX fximperija
2 years ago
Nice fximperija!!
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4xForecaster PRO fximperija
2 years ago
Hello @fximperija - I would look for a potential 50% retracement from a LOWER position. Model is targetting a lower completion point ... I will post a new chart to reflect the outline of a Shark, with potential retracement to Point-A of that same Shark, so as to complete a 5-0 (it would overshoot the 5-0 in this lower-target scenario, though).

David
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02 OCT 2014 - Update:

Here is a refined lower target (original is TG = 108.677), as price action continues to detail an Elliott Wave's Expanded Flat, which by definition would seek completion BELOW the termination of Point-A.

Overlaid is the point-definition of a Bullish Shart (greyed-in points are "ZERO-X-A-B-C"), which also shares the same lower completion point expectation as the EW's Expanded Flat.

A reversal above 108.88 could possibly upset this development, however, at this point, we are still expecting a significant Wave-4 development, as it should help carry price action across the current overhead bearish trendline (PURPLE dashed line) - Elliott Wave points have been left out for clarity sake - See H1 chart below:


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OVERALL:

Overall, predictive/forecasting model defined a lower value from which a correction might occur. This value is also supported by the combined pattern development of an Elliott Wave's Expanded Flat and a Scott Carney's Bullish Shark. If and once this lower qualitative-low target at 107.941 is reached, then expect a relief rallying in price to a minimum of 50% and a potential maximum of 0.618 from this current bearish impulsive swing, thus bringing price back to Point-A of the Shark, which is usual to witness when A Shark rolls into a 5-0 Pattern and completes at its own internal Point-A.

David Alcindor
+2 Reply
02 OCT 2014 - UPDATE:

Traders,

As indicated earlier today, there remained more downside. Price did fall further, and neared its 107.941 target - See H1 chart:


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David Alcindor
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IvanLabrie PRO 4xForecaster
2 years ago
And I'm out at 108.78...got in too early, lesson learned. Had to cut some losses on part of the lots at 108.4. :/
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06 OCT 2014 - Update:

Two days ago, we were looking for the development of a Shark at its Fibonacci extended depth of 1.131. This was first supported by a predictive/forecasting model which had defined the following bearish target on October 02nd:

- TG-Lo = 107.941- 02 OCT 2014

Following is a frame by frame evolution of the trade, simply using the charts that were already used for earlier discussions:


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In the last chart (today's chart), it is obvious that the pattern had exceeded its minimal 50% retracement of its bearish swing, as it went on to define Scott Carney's 5-0 pattern, which is an expected geometric development following a Scott Carney's Shark completion.

There was a significant failure of the model, as this Shark completed a very short distance ahead of the model's TG-Lo at 107.941. Perhaps fronting this trade would have allowed the aggressive trader to take on a long position, whereas a more conservative trader might have entered at the completion of an internal impulse's Wave-1, although it left very little time to do so.

Interestingly. price rallied to its highest internal Fibonacci level, at 0.886. At this point, the question remains whether price will carve lower lows or surpass the recent high. The following larger frame was posted earlier than the current chart, and indicated the completion of a greater geometric system in a Wolfe Wave. Here, the loftier 109.786 target was attained as per forecast, however, on a pure geometric basis, the 5-prime (5') point remains unanswered, offering a conundrum here, as one has to answer whether better becomes the enemy of good, as the 5-prime is not quite validated - See WEEKLY chart:

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Setting our mind's eyes back to the 4-Hour chart (see below), we now have to ponder on what sort of geometry is unfolding. In that chart, all targets have been hit, except the "TG-Hi = 110.255 - 01 OCT 2014". This level would certainly respond to the WEEKLY's demand for a 5-prime completion. However, the model has signaled a nascent bearish market force, which if sustained, would make that target another near-miss.

I would recommend the structural trader to keep an eye on new structural definitions, whether in the carving of higher highs or lower-lows. When price remains relatively tight in such a vice-grip like range, internal wave counts, indicator signaling and structural analysis might offer the earliest concert of directional clues, provided that they have been tested as reliable indications.

A simple RSI interpretation here will tell you that bears are being favored, and the corresponding levels where yellow and red arrows are located will define the strong and strongest levels of overhead resistance, respectively, if price were to rise to them.

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Cheers,


David Alcindor
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IvanLabrie PRO 4xForecaster
2 years ago
Interesting, was looking at this one, I entered short but not sure how long I can ride that move down. I'm tempted to think there's an expanding triangle going on, but those are rare as far as I know.
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resurrector007 PRO 4xForecaster
2 years ago
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I was of the impression we got done with a sharp correction i.e. the 4th wave. The way the current waves are forming still shows the move up was impulsive and the correction down is more corrective i.e. by the price movement. I see wave 3 of 5 hitting 110.5$$.
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resurrector007 PRO 4xForecaster
2 years ago
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07 OCT 2014 - TECH-NOTE: On The Correlation Between $JPY and $ES:

From "Predictive Analysis & Forecasting" and "e-Mini" chatrooms
- Link to e-Mini chatroom: https://www.tradingview.com/chat/#Fu3tMkKy660WGNhU
-------------------------
$ES-M15 vs. $JPY-M15:

Here again, looking at the Yen and e-mini SP500 in 15-minute chart - Several observations:

1 - Following a protracted start of a bearish swing, $JPY rallied to slightly higher than 38.2-Fib level as it dipped into a smaller geometry (potentially a small Elliott Wave Expanded Flat (one may perceive the small 3-3-5 internals).

This reactive rally would be considered a smaller-degree 4th wave.

Price went on to decline further to a lower level at 107.741, and reversed to the current position.

Note how the symmetry in the current smaller rally repeats the height that was achieved by the first reactive rally.

In a pattern parlance, this would represent a symmetrical AB=CD pattern (not to confuse with a One2One pattern, where the angles of the rallies would be leaning backwards instead).



Note that the height of the first bearish swing, represented by the letter A, and in which the 0.382-Fibonacci retracement help provide the measure of retracement for not only the first but also the second rally (current position), was also further used to represent the internal bearish swing between the two rallies, represented by the square A".

In other words, there is an important geometric tempo that is maintained here, which is not too dissimilar from the Euclidean Module which I used to use in the past to forecast extent of swings.

On a side note, I have decided to make note of the heights B (the distance between the two 38.2-Fib retracements), as well as C = 1.000-0.382 = 0.618) and D = 0.618.

I expect that these may serve as further module in the price action ahead, or perhaps not at all.

In any case, these are internal measures that are immediately available and worth using, much like a broken branched used as a walking stick down an uncertain trail.

Now, off to the $ES-M15:

Here, we were rather successful in calling 1925.25 as a significant level.

See the recent predictive analysis/forecasting done today to review the frame by frame evolution of as it moved towards this target.

A 'worst-case scenario" was built in as well, which could be used as a stop-loss or a reason for a partial entry.

However, it appear that this was not necessary so far.

STRAT:

Going forward, I would look at price action in the $USDJPY to offer some guidance as to the level where price in $ES might turn around.

More specifically, the levels defined in $JPY are 109.222, which would negate the running flad assumption; 107.741, which we tell me that price is likely to move on down further with or without a completed geometry above; and 108.641, which is the level I would like to see remain intact, as price nears it, but not cross it, so as to maintain a running flat valid.

Hence, a reversal in $JPY at that level should direct the trader's mind's eyes to wave counts in $ES.

The structural levels in $ES were defined as 1939.75, 1944, 75 and 1050.50.

However, if price were to near 1964, or even surpass 1971, I would have to consider higher timeframe, where the interference would probable originate.


OVERALL:

Look for a near-lock-step price action between $USDJPY and $ES. It is not always clear to see whcich one may precede the other, but so far, $JPY has led the near-synchronous moves, at time with price ranges far wider than those provided iby $ES in response, and at time, moving in opposite direction, but never to a level that would reach a significant Fibonacci difference in their range differential.

Cheers,


David Alcindor


+2 Reply
4xForecaster PRO 4xForecaster
2 years ago
NOTE: Here is the link to the chart: https://www.tradingview.com/e/vyGNETQR/#


David Alcindor


+2 Reply
damir.news
2 years ago
elliot wave C USDJPY
+1 Reply
damir.news
2 years ago
Gartley USDJPY 4H LONG
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4xForecaster PRO damir.news
2 years ago
Hi, @damir.news - You posted these charts a full month ago? So sorry they fell under the radar - David
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Hi David. Will you consider today's pin bar at TG-x, as a sign of reversal? Or you personally consider more confirmation. If affirmative, what does confirmations are?- Thanks, Hamed
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4xForecaster PRO HamedAghajani
2 years ago
Hello @HamedAghajani - the market rose so far, so quick that it tore through any rationalizable target. I had posted the TG-x target, expecting that this pair would get stretched, but I did not anticipate it would have gone so quick. in fact, the original analysis called for a relief decline first, and then a possible rallying into this extreme target.

To answer your question, indeed, a pinbar, doji, or a relatively large bar opening at the low then reversing towards the low reflects a sure sign of either testing a potential future level, or simply and most commonly a sign of repulsion at that level, where large players may have lined up sell orders.

From the INATITUTIONAL activity, I can tell you that there are currently TWO active LONG traders (long-term), and TWO L.O. to go long (short-term). Therefore, the outlook from a bank standpoint is to remain long ... This is all that I am allowed to reveal. Still, it's pretty telling of the bullish outlook for now.

Now, this is not to say that an interim decline is not in order, or even that these banks are wrong, but it is worth noting what institutional tailwind is pushing this pair forth.

From my predictive/forecasting mode, I can say that several indicators have called for a reversal. The chart alone indicates that a top was reached, and a recent posting of the USDollar idex (a basket of currencies pitted against the USD) shows a TG-Hi has been attained. Still, here too, price has straddled that target, and reversal is expected.

If no reversal occurs, it means that the timeframe in consideration will need to be ignored and I would need to look at a higher timeframe, where larger players are able to interfere. Here, this would be a no brainer to say that #BOJ has been diluting its currency, but I would have expected a temporary respite at the very least. Instead, price has kept on creeping up, like volcanic bile up Gozilla's esophagus.

A little bearish burp would do. Waiting for it.

Cheers,

David Alcindor

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HamedAghajani PRO 4xForecaster
2 years ago
Thanks, it was very helpful.
Reply
HamedAghajani PRO HamedAghajani
2 years ago
Do you perform COT index analysis for understanding constitutional appetite?
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