Friday, February 16, 2018

The EUR/USD RSI Divergence Is Deepening

Yesterday the EUR/USD pair continued moving north throughout the day and it even reached a new local high at 1.25556 which is two pips less than the local high from 5th January 2018 (at 1.25375).

Regardless, the RSI on the D1 time frame is signaling for a possible depreciation. If the pair reaches the limit of the divergence it could fall to 1.2100 – 1.2090.

There are mere hours left until the end of the trading week and the way the D1 bar closes could give us another confirmation for the possible depreciation.

The expected movement is corrective and it should be part of the fourth wave >>>  before the pair renews its rally for the final fifth wave.

This scenario will be invalidated in case RSI breaks out above the red line connecting the highs of the divergence.

Thursday, February 15, 2018

An Upward USD/JPY Correction Is To Be Expected

The pair maintained its downward trend throughout the week and today it approached the support around 116.00 – 105.90.

I think that around that support there are several probable scenarios:

The first scenario is that it is possible for the pair to test the support and to begin a correction to the upside.

The second scenario is that the correction has already begun while the expected critical target for the move to the upside is around 107.90.

In case the pair breaks out above that level and it manages to remain above that level we could consider a renewal of the upward trend.

The alternative is that we could witness the formation of a new local low around 105.20 – 105.00.

Wednesday, February 14, 2018

The EUR/USD Fourth Wave Correction May Not Be Over Yet

EUR/USD may be forming a fourth (light blue) wave of the fifth subwave of the third main wave of the impulse. That wave counting is probably most clear to those who have some idea of the Elliott Wave Theory but in this case, considering the impulse to the upside and the impulse formations in general it is not hard to recognize it.

If that supposition is correct then the pair may depreciate once again, to 1.2200 but it should not drop below 1.19611, i.e. below the high of the potential first (light blue) wave.

After the end of the fourth wave we could expect another impulse to the upside which will form the final five waves and with that the entire main (red) third wave will end.

There is a possibility, I think, to see a shortened fifth (light blue) wave, in which case the high of the last fifth (light blue) wave won’t reach the high of the third (light blue) wave, but that usually happens during a lot more powerful movements and such a movement seems to be lacking in this impulse.

Tuesday, February 13, 2018

The Predictions Regarding Bitcoin Development Vary Widely

Despite its rather impressive drop from almost 20,000 dollars per Bitcoin the most popular cryptocurrency on the market is once again moving north, albeit not at such an accelerated pace as it used to before its depreciation.

The predictions concerning its future development vary wildly from analyst to analyst. According to some assessments, Bitcoin will rally up to $30,000 - $35,000 until the end of the year and up to $100,000 over the course of the next few years. According to other very generous assessments, we may see a rally of up to $1,000,000 
eventually. Whether that is an exaggeration or not will become clear over time.

Of course, there are some very skeptical analysists as well, predicting another depreciation to $5000 per Bitcoin.

Monday, February 12, 2018

USD/JPY Is Still Testing The Support Zone

USD/JPY continues making attempts to break out below the first support zone>>>  at 108.00  - 107.50. For the moment the pair has reached 108.04 and I think it is possible it will continue testing that zone. In my opinion, if it breaks out below it and remains below it we could expect a continuation of the depreciation toward the next support at 50% Fibo (at 100.50 – 99.50) of the impulse that began in October 2011 (at 75.564) and ended in June 2015 (at 125.854) on the monthly time frame.

The alternate scenario is for a new rally to 109.30 – 109.50 which could completely neutralize the attempt for a depreciation and return the pair in the consolidation that formed for the past two weeks.

Saturday, February 10, 2018

EUR/JPY In The Next Few Weeks

EUR/JPY reached the limit of the multi-day range between 131.40 and 134.40, as you can see on the screenshot of the D1 time frame, and right after that it began to depreciate.

On the W1 time frame we can see a RSI divergence and if the pair reaches its limit it should fall to 128.50 – 128.40. At that level there is a support zone marked by a light blue line on the monthly time frame.

 The next support is at 125.50 – 125.00 and it is marked with light green.

The alternative scenario is for a rally to the resistance in the zone around 139.00 – 139.50.
We should also watch the RSI divergence – in case there is a breakout above the divergence trend line we could expect a rally to the resistance zone.

Thursday, February 08, 2018

EUR/USD Is Developing A Fourth Wave Correction

When impulse is in development (according to the Elliott Wave Theory), the movement of any given pair is easily predictable, because the impulse waves develop according to very strict rules. In this case the EUR/USD rally makes no exception.

If we examine the W1 time frame we could suppose that at the moment is developing a fourth wave (in green) from the fifth blue wave, within the third red wave.

If that supposition is correct we can expect that the corrective depreciation that has reached 38.2% Fibo of the supposed third green wave either won’t end at that level or it could develop a little more and reach 1.2125 – 1.2100 which is 50% of the impulse rally of the same wave. After that, I think, we could expect the final rally of the fifth green wave (of the fifth blue) within third red wave.