With price meeting Nov 2014 low, technical traders are looking to the current level as a hot spot, where a reaction higher or break lower is likely to occur. The retail sentiment at FXCM is showing 4 times as many traders who are long versus who are currently short. These short traders become a pool of future sellers when they decide to close out their trade.
From a technical perspective, there are 2 wave relationships showing up in the 1130-1135 zone...so these traders MIGHT be right. If a break does occur, there is another wave relationship at 1093 and around 1065.
The Elliott Wave labels on the chart suggest we are in an expanded flat correction and prices are likely to visit above 1300 in the coming months. The question is, how low does this expanded flat push?
The false breakout zone extends to 1065. The deeper we cut towards 1065, the better the risk to reward ratio.
A large reason why I'm favoring the expanded flat is the slope of the sell off since January. This recent sell off has a much softer slope than the prior 2 waves. Therefore, it is behaving more like a 'B' wave than a 3rd wave.
Best of luck!
From a technical perspective, there are 2 wave relationships showing up in the 1130-1135 zone...so these traders MIGHT be right. If a break does occur, there is another wave relationship at 1093 and around 1065.
The Elliott Wave labels on the chart suggest we are in an expanded flat correction and prices are likely to visit above 1300 in the coming months. The question is, how low does this expanded flat push?
The false breakout zone extends to 1065. The deeper we cut towards 1065, the better the risk to reward ratio.
A large reason why I'm favoring the expanded flat is the slope of the sell off since January. This recent sell off has a much softer slope than the prior 2 waves. Therefore, it is behaving more like a 'B' wave than a 3rd wave.
Best of luck!
Best regards.
With your post we have best technical classes here.Wishing you all my best.
Weekly:
Daily:
4H-tf:
Expectation:
More specifically to your point, it is an interesting alternative. I am curious how you count out that C leg of - the flat correction. Would you mind posting it below?
50% correction at 1086
deeper 61.8 at 889 - which will be toughest
And on monthly charts you can see that from 2013 drop we didn't advance much lower.
If not, the fibonacci from low to high won't work.
Sentiment is contrarian...so as retail traders shift towards bears, look for bullish opportunities.
As of now, the sell off stopped at the lowest point noted in the original analysis. The expanded flat correction suggests a 5 wave 'C' wave higher. The overnight low is a key level if 1130 is regained.
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SSI is steady at +2.0 so net positioning hasn't changed much on Gold.
Open positions show longs have grown slightly (up 4%) and shorts are down slightly (-2%) compared to last Friday's levels.
Further dipping may take place and 1060 area may see a real test coming. Wave relationships and wave positioning suggest 1060 area holds on the first test. A move above 1119 builds the case for a bottom.
I will be out of pocket for the next week. Talk with when I get back.