first majestic silver

Weighing The Probabilities For EURUSD, DOW Index And Gold

May 14, 2017

Upcoming Events:

USD: Empire State Manufacturing Index, G7 Meetings

EUR, GBP, JPY: G7 Meetings.


EURUSD 30min:


Welcome to another weekend.

The time is ticking by!

And these price structures are developing slowly, but nicely all the same.

Let’s dig into it!

EURUSD has traced out a possible five waves to the downside this week.

The price broke support at 1.0850 for a brief moment and has rallied back strongly in a possible wave 'a' green today.

The price has reached the first resistance level this eveningat 1.0930,

This is the 50% retracement level of wave 'i' pink.

So if this is the beginning of a corrective rise in wave 'ii' pink, then we need to see wave 'b' and 'c' happen early next week.

Price must stay below the upper resistance at 1.1021 in order for this immediately bearish wave count to remain valid. A break of the high will merely postpone the DOW turn for another week or so.

I have shown an idealised path for a zigzag correction to take, so let’s concentrate on that next week,


DOW 30 min:

DOW 4 hr:

I have shown both operating and the alternate wave counts in the short term chart tonight.

The reason being,

They are both equally likely at this stage!

The action over the last few days has lifted the probability of one last high in the DOW to 50% right now,

The action off yesterday’s high has tipped the scales a lot.

This decline looks corrective and sits in a nice trend channel shown in blue.

So, the action off this week’s low looks like a wave '1' and '2' combination.

This is bullish in the short term as it is calling for a rally next week in wave '3' blue.

This rally has the potential to carry the the market to a new all-time high and one last party on Wall Street.

Do not confuse this short term bullish view as a shift into a completely bullish stance.

Oh, no no no no no!

What we are witnessing in slow motion is a multi-decade cycle coming to an end.

This takes time, but the larger degree wave count has not changed one iota!

The next big move in the stock market is to the downside,

And almost certainly in the form of a massive crash.

I have no doubt in my mind about that.

But a market top is a process, not a moment in time.

Each new iteration of the wave count draws us inevitably closer to the actual top.

The wave count will catch it first, the rest of world will catch on after the ATM ques form!

You won’t find me standing in line.

For next week 20798 is the focus.

If that line holds and wave '2' blue completes in a three wave fashion,

This will lead to a large move up in wave '3' blue.


GOLD 30 min:

GOLD 4 hr:

The message from the market this week is that GOLD is turning up, and the market internals that I follow are looking far better and pointing to a rally phase beginning presently.

We have a definate BUY signal in place in the 4HR chart,

Both the RSI and the MACD have crossed up above the centreline from a bearish extreme

The price action is looking positive,

And the elliott wave pattern is showing a completed correction

and the beginnings of an elliott wave bullish signal forming.

The final hold out in the puzzle is the lack of a few bullish price candles to lift the price above resistance.

I have no doubt that sort of price action is on its way.

The trend channel is the first leg to clear, price must lift out of the channel in wave '3' pink.

A break of resistance at 1239 may be enough to shift the momentum back in favor of the wave count.

That’s all for this week.

See you all again on Monday, hope you all have a great weekend!

Courtesy of


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