throughthemud

setting up for 3rd of 3rd down gbp and euro

by my estimation a wave b has just ended so i'm currently looking for 1.4710 on the euro

the last 5 wave structure down on the euro had an overlap on the fourth wave triangle and all 3 waves down were about equal in magnitude. There are two ways of counting this. It is either a c wave of a larger degree or the first wave down of a larger degree. The most likely is that it was the entirety of wave 1 down. There is another possibility that I have not seen since I've been trading elliott waves and that is where there are 5 approximately equal waves down (an undefined extension). I will of course trade the highest probability interpretation and change if price invalidates it

target on euro is 1.4475

I got stopped out at a profit but I'm looking to reenter. I don't want to believe that triangle until we break 1.4613

GBP/USD End of Week Analysis I was expecting a new low today but we got a truncation at best. I'm not completely comfortable with calling that the end of the wave but I am trying a cautious long play anyway. Looks like we'll have an upward correction next followed by a lot more bearishness. Wave 3 looks like it has the power to be an extension so my minimal targets are the 1.618 levels on the daily chart. There are a few things that make me nervous about where the pound has been. The first thing is that ugly correction after wave 1. Second the overlap between wave (iv) and wave (i) of wave i (circle). The third is the questionable truncation that occurred yesterday. My count still fits the form of the bigger picture so I'll keep trading that way until I'm proven wrong.

This is a weekly chart of the EUR/GBP. I might start trading this also since it would help me with my euro and pound trades. As I have the chart labeled the euro is in a bullish primary wave 1 (circle) move against the pound. This might alternatively be wave B circle but no matter which is corrective it appears the euro will continue to advance against the pound for quick some time. This fits with my forecast for the EUR/USD and GBP/USD pairs.

End of Week Euro Analysis Unfortunately it appears the EUR/USD has not yet topped. The move downward was in 3 waves and the wave v (circle) was not fully retraced so I'm reentered on the long side and have changed what I was previously counting as the entirety of wave v (circle) as being wave (i) of wave v (circle). If you look at the 15 minute chart of the euro I have labeled what I believe to be a series of ones and twos leading to a high momentum rise for wave iii of (iii). Minimal targets will be 1.4793 but I expect it will go higher than 1.4840. I have also attached a couple daily charts. The first shows the subdivisions of wave 5 of ©. As shown on the chart the equality target for wave i (circle) and wave v (circle) is about 1.4943. Not shown is that the target where wave (i) is 0.618 the length of the entire wave v (circle) which is just 40 pips beyond that at about 1.4988. The last chart is also a daily a chart showing a trendline from the tops of wave 1 and 3 and also price targets for equality between waves 1 and 5. These projections are farther out and it's too soon to see if any of these will matter.

i'm looking out for possible strong upside on the euro. last move was 5 waves up and the last wave up still hasn't been fully retraced

wave 3 down was not large relative to wave 1 so either it is wave 1 of an extended wave 3 or more likely this next wave is wave 5 down and it will be extended like the pound did last wave 9/17 - 9/21. the pound probably doesn't have much more room on the downside before it's next multi day correction as it appears to be entering a fifth wave.

here's the chart for the last post

Euro Minimum Targets 1.4645 - This looks like an unlikely target but if it is a wave c than this would be equality to wave a. If it turns at this point than I would reenter the position on the long side 1.4548 - The minimum target for my 3rd wave forecast. This will likely be an extended wave so look for this third wave to have an exaggerated 5 wave pattern subdivision which will also lend itself to a more precise final target. As I typed this what may be currently occuring is the 2nd wave of the 3rd wave

looks like wave 3 down (or C has started)

Here is my current count on the euro. The numbers aren't at the right degree but that's irrelevant for this purpose anyway. This whole corrective movement might just be wave a but even if it is it's still worth the trade. If this is the end of wave 2 up then the first likely target for wave 3 down would be 1.4500. Reasons for not counting this correction as over. -Wave 2s usually rectrace over half of corresponding wave 1s (this has only retraced about .382) -The retracement hasn't lasted very long -rsi hasn't even approached overbought on the hourly

looks like 5 waves down in the euro lending extra weight to that last high being the top.

Here's a link to the information I was talking about. It should give you the basics. Feel free to ask any questions. Free Elliott Wave Info

I would be surprised if the balan book did not discuss price targets but I know Elliott Wave Principle by Prechter and Frost does discuss it. I think they have some info from the book on the elliott wave international website. Waves are the same at every degree (time frame) so whether you trade on 15 min or daily charts you will trade the same. A sample of guidelines (high probability forecasts) for price targets are Wave 3 will be at least 1.618 times wave 1 wave 5 = wave 1 or is 0.618 times wave 1 There are a lot more than that especially for corrections and it would definitely be worth your while to buy Elliott Wave Principle. I think it is only $20 - $30.

there is too much near term downside potential for the 1.4855 call

I'm looking for another possible rise to about 1.4855. If there is another small 5 wave drop to a new low it will just be a correction but if it doesn't make a new low then it will most likely reach 1.4855.

I use 7 period RSI but generally only to find the end of corrective patterns. It is usually not useful in determining the ends of impulse waves. stop loss on an impulse wave would be the beginning of the wave. b waves of corrections can go past the beginning of wave a so you have to place your stop a little bit back on corrections since the same thing happens at all degrees you can place your stop in much more specific locations by looking at what is happening one degree higher and one degree lower than your trading

not all forex brokers make money by trading against you but on smaller accounts most of them do. if you want to know whether your forex broker is screwing you look at quotes from different brokers or free sources all over the internet. my broker had a bad tick once and they gave me the money it cost me plus extra since it was there mistake. I take money out about every 2 weeks. They haven't ever said anything negative to me about it. I'm sure there are lots of horrible fx brokers out there but they're not all bad. I started out using GFT and they are a shitty brokerage. If you trade with them you'll probably have a bad experience. The spread is small on everything including stocks, forex and futures.

the level the euro reached is especially important because it is equality between wave (A) and © that I had mentioned before. that level is a high probability guideline of the wave principle

looks like the top is in for the euro. the pound is in a good spot to continue its decline also

Yes forex has spreads but so do stocks but stocks also have commissions and that is my whole point. If you have a problem with your forex broker you can still bring it up with NFA. You can go to their website and check on all the cases they've ruled on. As long as you get a good broker there is no problem. I would probably be safer in futures but I haven't had any problems trading forex so I'm happy.

Hey dave, You won't have any liquidity problems with FXCM. I've been with them for almost a year and I only have good things to say about them. When I first started trading forex I think I made 100% return in 2 days but then I lost almost all of that just because I became overconfident and didnt take my time analyzing the market before trading. This has happened several times but I've learned my lesson and I've been doing better and better. I've found that there is a lot more bad information out there than good information. They best policy when trading is to be patient whether that means waiting for all your indicators to line up or taking time to do adequate analysis. Patience is the biggest key for me at least.