EURO

EURO weekly

recent action shows similar pattern to that between April and August 2011.  Will it resolve in same way?  I.e. DOWN?

The daily chart shows what appears to be a TRIANGLE or Head and Shoulders formation

Upper boundary around 1.3270

Lower boundary 1.30 (neckline, base triangle)

Dax daily

Well if the count is correct looks like we are close to finishing, but I would expect some sort of panic move down and recovery to signal the downside has ended.

The bullish scenario:
The 200 dma is at 6190
Or a sharp 100 point drop and recovery..the UP UP and AWAY

The bearish scenario..
The DAX has already topped @7180 in March and we are now in a wave 1 and a wave 2 (abc correction) will occur when this down move is finished.

EITHER way it looks like the next decent move will be up...

The only CAVEAT is that the DOW looks like it should have quite a bit more downside left..

Cable update low risk short level..

Cable daily

 Now at top of the "megaphone" pattern, and also horizontal resistance.  Good low risk short level.  

DAX 2 hr chart

DAX 2 hr chart showing bear flags, just breaking another one..start of move down in 5th wave to 6450?

Cable /EURGBP

Cable has been relatively strong recently both vs the € and the US$, why? Maybe with the continuing EURO area problems, and a perception that the UK has a more flexible economy and an independent Central Bank, there may be (ironically) a rush to "safety" !

Looking at the charts

Cable daily close up


Still trading within what looks like a BROADENING WEDGE or MEGAPHONE
Key level seems to be 1.61 (trading at 1.6060 at time of writing)
strong resistance just above between 1.61 and 1.62

CABLE daily

Big picture could still be a large Head and Shoulders formation, a break out above 1.61 probably invalidates this and resistance would then be at 1.65

EURO/GBP


Hovering above key support , break through or rally?

EURO support test and PASS!

The €/$ tested support at 1.30 yesterday and passed with "flying" colours...now it has to overcome the next test to the upside at around the 1.32 level...and then the declining trend line at 1.3370 for a real push higher towards 1.37/1.40

A failure here could see another push down, below 1.30 next stop 1.26

DAX 30 mins fractals

Looking at the DAX 30 mins chart

1st rectangle shows down move followed by retrace which recovered 78.6 % of down move (Fibonacci)

2nd rectangular area (so far has retraced 78.6 %) see if it holds..interesting to see if we get the extended move down afterwards towards 6480/6450 support as outlined in post yesterday

FTSE

So as expected the FTSE daily looks similar to the DAX, with one clear difference if we are looking at the Elliott wave labeling; Wave 4 on the FTSE seems to have broken into Wave 1 top.  Reading EW theory it seems that wave 4 should not retrace to wave 1 (somebody please enlighten me!!)  Link to Elliott Wave rules 

So this means either
A. something else is going on (market may have completed the bull run and now on an extended down move)
or (more likely!!)
B. wave count is wrong!! (It does look good though!)

DAX (Germany)

The DAX daily chart updated below, shows the market could still be in a WAVE 4, with the final wave 5 up to come.  Where is it likely that wave 4 will end?

Well price action is nearing trendline support at 6490 (ish) which is also near top of wave 1 at 6430.

DAX 30 minutes

shows we could be finishing a wave 3 down with a 4 up and final 5 down to complete wave 4.  This pattern could also tie in with a false break down in the EURO and Copper

US markets also seem to need a little more downside corrective action..

EURO daily

The €/$ (EURUSD) is hovering at support near 1.30, TRIANGLE or Head n shoulders?

Similar to COPPER chart in that we could see a false break lower, followed by a strong rally...

Or  a move lower and test of the lows at 1.26

break though neckline or triangle lower boundary , target is 1.2550


Break through upper boundary triangle , target is 1.3790

Copper update

More weakness today and pushing through the upward trend line..now it could be a FALSE break.  Wait for follow through to downside, or if it fails then chances increase that it's a false break and the triangle target at 440 remains

COPPER at key level

Copper is taking it's time to find a way to the target from the break out of the symmetrical triangle and after yesterday's fall is right at the rising trend line, which SHOULD be support..HOWEVER the picture is less clear now and a fall through here could see a significantly sharper fall.

Volume on yesterday's drop was high..and may have exhausted the drop..

Worth keeping eye on as Dr Copper usually is a good indicator of the world economy...

Spain in the spotlight!

Well it looks like Spain is now in the spotlight and probably worth looking at the stock market there.
One thing is clear is despite most world markets having a positive performance since November 2011, Spain's performance has been muted and in recent weeks has been clearly negative, and the market is now hovering above a key level at 7500.

A break below here could also have negative repercussions for other European indices, in particular Germany.

IBEX 35 Monthly chart

IBEX weekly

DAX filling GAP @ 6709/6680

Just for "laughs" here is a possible BEARISH count for the price action on the 3hr chart...

DAX 3hr 

Sti

DAX hovering above short term support

Dax 3hr chart shows about to test 6840 level and a break  through there targets 6709 (Gap Area).  In the bigger picture this could still be a 4th wave with a 5th wave yet to come to test the highs or more likely NEW highs.

Wave 4 could go as low as 6475 level... (top of wave1)