Daily Elliott Wave Analysis: The Makings of an Important Turning Point for USD

By: Enda Glynn | Thu, Apr 13, 2017
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30 min

EUR/USD 30-Minute Chart
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4 Hours

EUR/USD 4-Hour Chart
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EUR/USD Daily Chart
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My Bias: short in wave 3 blue.
Wave Structure: downward impulse wave 1, 2 blue
Long term wave count: lower in wave 3 blue
Important risk events: EUR: N/A. USD: CPI m/m, Retail Sales m/m, Treasury Currency Report.

Hola Amigo's!

It's the end of the week already, The market is closed tomorrow
So this is the last update this week until Monday night as usual.

Last night I spoke of the importance of the action at the close of this weeks session.
Give the larger wave patterns at play in both the 4hr and daily charts in the Dollar cross rates.
These patterns are very bullish for the Dollar,
And we are at the end point of a corrective phase right now.
The next step for the USD is a large rally,
And it is dead ahead!

Todays price action has turned in favor of the Dollar across the board, so we could be looking at the beginning of the next leg up.

EURUSD traded down today, before reaching resistance at 1.0688.
Wave 'ii' looks to have completed a complex running flat correction at todays high, labelled wave 'ii' pink.

The decline off todays high is quite impulsive looking and broke through the first support at 1.0629.
I have labelled this decline as the beginning of wave '1' green,
Within a developing wave 'iii' down.

1.0677 is an important resistance level for now,
The formation of a lower high at around 1.0630 will create an elliott wave sell signal
And a very bearish setup for EURUSD.
For the early trade next week that is the action to watch out for.


30 min

GBP/USD 30-Minute Chart
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4 Hours

GBP/USD 4-Hour Chart
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GBP/USD Daily Chart
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My Bias: short below parity.
Wave Structure:  continuing impulsive structure to the downside in wave (5)
Long term wave count: decline in wave (5) blue, below parity
Important risk events: GBP: N/A. USD: CPI m/m, Retail Sales m/m, Treasury Currency Report.

Cable rallied into resistance at 1.2560 and fell off again in what could be the beginning of a new leg down.

The new wave count worked well so far,
If the price breaks down below support at 1.2480 with a three wave minor rally off that low.
Then, just as in EURUSD, an elliott wave sell signal will be in place,
With a very large bearish potential, given the larger wave count.

On the 4hr chart, Momentum is turning down again at a crucial time in the wave structure.
all these signs add weight to the operating wave count and signal an important turning point is underway in the Dollar markets.

Todays high is important for the early trade next week,
That is at 1.2574, this level forms key resistance, and is now likely the last high GBPUSD we see for some time to come.


30 min

USD/JPY 30-Minute Chart
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4 Hours

USD/JPY 4-Hour Chart
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USD/JPY Daily Chart
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My Bias: LONG
Wave Structure: rally in wave [C]
Long term wave count: wave [C] is underway, upside to above 136.00
Important risk events: JPY: N/A. USD: CPI m/m, Retail Sales m/m, Treasury Currency Report.

The 4hr chart in USDJPY is telling an important story right now.
The momentum indicators have put in a double bottom with a this weeks RSI low being a higher low.
This is a very important momentum divergence given the larger bullish wave count in operation here.

There is the possibility of a slight new low in USDJPY next week going by price action on the short term chart
The rise today has so far occurred in three waves,
Which is a counter trend pattern.

Any new low will be temporary from here as the Dollar is displaying signs of a real low in place.

The first important resistance lies at 110.10, a break of that level
and the formation of a higher low above 108.72, will signal that the low is in place for wave '4' orange.
As with the previous two markets, next week is pivotal.

Dow Jones Industrials

30 min

Dow Industrials 30-Minute Chart
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4 Hours

Dow Industrials 4-Hour Chart
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Dow Industrials Daily Chart
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My Bias: market top is in.
Wave Structure: Impulsive 5 wave structure, possibly topping in an all time high.
Long term wave count: Topped in wave (5)
Important risk events: USD: CPI m/m, Retail Sales m/m, Treasury Currency Report.

The DOW is again punching lower in what could be the beginning of wave 'iii' pink.
The key support level I have been pointing out over the last few weeks is 20410.
And todays new lows are getting close to that level.

There is one more bearish alternative for the wave structure off the recent wave 'ii' high.
That is a leading wedge in wave '1' red, shown circled in red.

This wave count would allow for another small rally into resistance at 20751 brfore turning down for good.

Momentum has turned down again on both the 4hr and daily charts,
The daily momentum has come off a double top at an extreme overbought level.
I think we are about to pay dearly for that over exuberance.

Watch 20410 early next week, this support is the last in sight for a long way down.


30 min

Gold 30-Minute Chart
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4 Hours

Gold 4-Hour Chart
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Gold Daily Chart
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My Bias: Long towards 1550
Wave Structure: ZigZag correction to the upside.
Long term wave count: Topping in wave (B) at 1500
Important risk events: USD: CPI m/m, Retail Sales m/m, Treasury Currency Report.

GOLD held at new highs throughout the day,
This is a very bullish sign in terms of the larger perspective.

Any consolodation form here would be in terms of wave '4' pink
With a further rally expected next week in wave '5' pink.

The larger wave count in blue is coming together nicely now,
and indicates this rally has much more to go before completion.
Support at 1271 should hold the market from here,
The price should begin to tag that upper trend line soon as wave (iii) blue closes out.



Enda Glynn

Author: Enda Glynn

Enda Glynn

Enda Glynn

I class myself as an Elliott wave trader now, but that's not how I started out though! It took me a long time and a whole lot of pain, to finally understand what drives the price and how to use Elliott Wave correctly!

I have been trading for years and I have tested every trading system and strategy under the sun! I used to pick entry points at random based on emotion or news events or something I heard on TV! It did not take long to destroy my capital! I have blown out my account balance before, and I had to start again,

from scratch!

Believe me, I am well acquainted with failure in trading! Im sure that the above scenario is pretty familiar to you too. We have all been there. About 10 years ago I discovered The Elliott wave Principle and its method of market analysis. Since then, I have spent years learning, testing and trading, using the wave principle as the backbone of my analysis. I even went to college to study macroeconomics and econometrics. I graduated with honours degree back in 2012. The financial market knowledge and statistical edge I gained after my degree added another level to my trading. The difference in my trading approach using the wave principle, compared to before, is like night and day.

The price started to move "my way" more and more often. The wave model, offers me a lens to view market action through, which no other form of analysis can do. Elliott wave analysis, helps me answer four key questions when I am contemplating a trade:

• What direction the price is trending.
• How far is this trend likely to go.
• Where can I enter a trade with the best risk reward ratio.
• And most importantly, at what point am I definitely wrong?!

The wave principle helps me improve my trade entry, tighten up my money management and in turn increase profitability. Seeing the waves unfold before your eyes is a very rewarding experience, It is almost like peering into the future! That is how the wave principle helps my trading, and that is why the wave principle will improve your trading. It took a long time to finally master Elliott Wave Principle. After over a decade of hard work, research and learning I can call myself an expert in the field. I regularly contribute to major trading communities at FXStreet, Forex Factory, Traders Planet. I am a chief Elliott Wave analyst at HumbleTraders.

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