Here is a potential opportunity to witness a geometric cycle completion of a pattern, concluding at its 1-4 Line validation.
Potential short-opp presents itself through the geometric completion of a at market close in this 4-hour chart. On last day of market, price reached the 1-3 alignment. This was paced into a 5-point morphology typical of the , which projects its "Take Profit" target via a probable 1-4 Line validation.
If price were to complete this geometric cycle, potential levels of support should be sought along the 1-4 Line of the pattern, in structural convergence with price levels of 7.64660 and 7.56234, corresponding to 50.0% and 61.8% Fibonacci levels. Historically, these levels align with significant , as highlighted in the chart.
Preceding this pattern completion, a reciprocal symmetry (ab = cd) may call for a potential rallying to higher highs - A weekly chart (not shown) would suggest that this segment corresponds to an 5th wave correction, and that a final 5th impulse would push price to higher levels, above current , either into a conclusive 5th wave truncation, or a full extension above Point-a of the background symmetry.
This represents a high-probability set-up at a higher, stable timeframe. The probability of recovery from the recent price swing (from point-2 to point-5 of the geometry) is high, but likely controlled at a Fibonacci pace, at significant levels defined in the chart.
Predictive Analysis & Forecasting
Durango, Colorado - USA
In order to keep the chronology clean, following is a mere cut/paste of the comments and charts made prior to this week:
* * * In order to avoid any confusion from a dual analysis which sought bullish target at the long-term timeframe (weekly) and mid-term bearish targets (4-hour chart), I have left the 4-hour chart or any smaller timeframe out on purpose - Following is only a cut/paste chronology that pertains to the original analysis on the weekly chart * * *
06 JUN 2014 - ADDENDUM:
For sake of illustration, here is what the WEEKLY chart would look for, enumerating a incomplete Elliott Wave impulse with its internal 5 waves (5th wave remains speculative, although Predictive/Forecasting Model defined a top target as shown in this chart, corresponding to a minor Fibonacci level):
Note that significant resistance is expected at the Bearish Entrenchment zone, if price rose challenged that level. For the Wolve Wave/Geo trader, remember that in the H4 chart, a ab = cd pattern was left to sight. This is simply a visual reminder that it may represent the 1-2 Leg of a 5-point anatomy pertaining to the Geo (which has a ab = cd rule requirement in its 1-2 Leg, in contrast to the Wolve Wave).
07 JUL 2015 - UPDATE:
$USDNOK drills through Bearish Entrenchment; Mulls Elliott Wave 5th wave completion:
$USD $NOK $norges #forex
03 AUG 2015 - UPDATE:
$USDNOK stomps against fierce bearish entrapment; Faces highest prob. of reversal; Geo lurks in background:
As price roll-steamed right through the anticipated "Bearish Entrenchment" zone, it ended up validating a long-term target defined on June 06th, 2015 as "TG-Hi - 8.66629 - 06 JUN2015":
At this point, a nascent Geo remains intact, as price reached a higher probability of reversal upon validating this aforementioned "Qual-Target" - Note that such reversal would likely be unimpeded, perhaps expressed as a bearish motive of 5-wave internals ... Worth the wait - The structure most likely to offer support is defined in the following chart:
In terms of Fibonacci value, this would represent a 61.8% contraction:
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"I´m a applying a safety rule in Wolfe Waves by waiting for a reversal and close below 1-3 trendline . It protects me from an unexpected extension of point 5 ."
Exactly. The rule is best applied if waiting for the open of NEXT candle/bar following price commitment to the other side of the 1-3 Line ("BACA" rule, which simply implies two core conditions:
1 - Breaking Across
2 - Closing Across
Very nice safety measure.
While the 4-hour chart is still playing out, the downside is now more limited as price reaches for the 5' position. I have left the internal ab = cd symmetry that appears to be playing out at this time, as price continues to rise:
In any case, Point-4 is becoming the most probable point of repose - if price were to decline from the 5-prime level - before the weekly chart was to resume.