Friday, 5 August 2011

AUD/USD chance for a bounce

I can't yet trust that the AUD/USD has peaked. I have four reasons for saying that.

First reason is the false trend line break on the daily chart ... admittedly not a very strong trend line. If the market rises above the next higher trend line, I would consider that more significant...


The second reason relates to Elliott Wave, and is also illustrated on the daily chart. The latest high came at the end of a 3-wave move, A-B-C. A larger degree impulsive move should only end on a 1-2-3-4-5 move, not an A-B-C.

The third reason also relates to Elliott Wave. Looking at the hourly chart now, the initial move down was an a-b-c. A new impulsive move would start with a 1-2-3-4-5. A move that starts with an a-b-c should prove corrective.


The fourth reason is that we have a throw over of the trend channel on the hourly chart, which may be complete, indicating that the next move will be up.

I am not saying that you should go long on the basis of the above. The near term trend is clearly down. In all likelihood I am trying to be too clever by half. But that Elliott wave count is bugging the bear in me. I guess what I am saying is, don't get caught up in the emotion of an exciting week, or if you feel yourself being caught up in the emotion, try to step back and consider the situation anew, with fresh eyes. You may well decide to continue holding your previous view, but at least you will have tested the alternatives.

Anything is possible. The AUD/USD has surprised me with its strength all year. I was certain that it had peaked back in April/May. Maybe we will get another test of that monthly chart trend line...

Gold and Silver put in tops

First, daily charts for each market.

Gold... throw over of trend line indicates a top. I'd guess it's not THE top, but that's simply a guess based on my observation that we haven't seen blow-off price action in Gold. The market will let us in know in due course.


Silver... trend channel line throw over, next move down. How far? Let's watch.


The following hourly chart for silver is beautiful, brings water to my eyes. Those parallel trend lines. So far the market stopped right on the lower line. We need to see a move lower through that line to validate the bearish call.  


Global stocks smashed (again)

What a week it has been, so far. I dare say the strength of the decline has taken even the bears by surprise. As ferocious as the decline has been in Australia, the US, and Asia this week, to my eyeball it looks like the Germans and Brits are down the hardest of all.


Weekly charts shown.

US S&P 500...




Aussie ASX SPI 200...



German DAX...



UK FTSE...



China H-shares...



India Nifty 50...



Japanese Nikkei...

AUD/USD

Daily chart... looks like the nearby trend channel line will be tested, but more important is the June low of 1.0391...


Zooming in to an hourly chart, just for a look....

EUR/USD and GBP/USD channeling

Hourly charts.

EUR/USD...



GBP/USD...