Get the New Elliott Wave Commodities Video Outlook 2019

by WaveTrack International| January 28, 2019 | No Comments

Commodities Video Outlook 2019 released

Commodities Prices to Resume ‘Inflation-Pop’ Uptrends in 2019 – After Shaky Drop!
INCLUDES ANALYSIS ON MEDIUM-TERM CYCLES & EQUITY MINERS

We’re pleased to announce the publication of WaveTrack’s annual Commodities 2019 video Outlook of medium-term ELLIOTT WAVE price-forecasts. Today’s release is PART II, COMMODITIES. Part I was released last month and Part III will be published in February.

• PART I – STOCK INDICES – out now!
• PART II – COMMODITIES – out now!
• PART III – CURRENCIES & INTEREST RATES – coming soon!

Commodities – Forecasts for 2018 – REVIEW

In last years’ annual 2018 EW-Forecast Video, several key commodity events were highlighted –

Base Metals were identified as ending their 1st wave upswing within the 2nd Phase of the ‘INFLATION-POP’ uptrend that began from the Feb.’16 lows. As a result January’s report forecasted a hefty 2nd wave correction unfolding through 2018. This theme was updated in the bi-annual follow-up report published in July ‘18

Precious Metals were forecast lower through 2018. Mainly as a result of expectations of a stronger US$ Dollar. Similarly, precious metal mining stocks were forecast lower with headwinds coming from a corrective downturn in global equity markets. However, the only exception was palladium which was forecast engaged in a strong uptrend

Crude oil cycles were still moving higher last January but they were next due to form a peak in August ’18. Meanwhile, crude oil was trading at 60.39 but was forecast up to 78.90+/-. Also Brent oil was trading at 66.92 with upside forecasts to 77.22+/-, max. 93.80+/- (averaging 85.50+/-).

How did these Elliott Wave price-forecasts pan out?

The main drivers that permeated most asset classes in 2018 also affected commodity prices too – to begin with, the US$ dollar staged a successful turn-around last February, heading higher to begin a counter-trend correction following a -15% per cent drop in 2017. That pulled Base and Precious Metals lower in-line with forecasts.

Copper was late in beginning its counter-trend decline, although others in the group, Lead and Zinc topped-out right on cue. Copper has since declined by -22% per cent!

The Base/Precious metal miners began to fall rapidly as the U.S. stock markets staged a strong decline late-January/early-February, triggered by the emergence of a tariff trade war between the U.S. and its global trading partners. Despite a recovery from April through to late-September, the overall sell-off resumed in October, pulling the miners even lower although Gold and Silver have since formed important lows in August/November.

Gold was forecast down to interim targets of 1157.65+/- from 1303.00 and ultimately towards 1123.00+/-. The August low was 1160.24.

Silver was trading at 16.96 in January ’18 with downside targets to complete a 2½ year correction towards 14.04+/-. The November ’18 low was 13.89.

Palladium was singled-out in last year’s forecasts as maintaining its uptrend – it went on to gain +20% per cent into December’s high.

The Energy markets were in a slightly different timing-rhythm to other commodities although upside targets for Crude Oil towards 78.90+/- ran slightly shy to end a 2½ year zig zag upswing at 76.90. But the Elliott Wave zig zag was perfectly formed into the early-October high – it has since declined by -44% per cent!

The Next 6-12 Months (2019)

When stock markets declined in early-2018, many large investment houses were caught out. Mainly because analyst’s economic outlooks remained on a growth path without any interruptions – a big linearly-extrapolated mistake. The next peak in late-September was more ‘telegraphed’ but still, asset managers were overly committed in their long portfolio positioning.

It makes you wonder what has to happen before liquidation occurs? – the answer – a severe sell-off! That doesn’t sound logical if the idea is to buy low and sell high as the maxim goes. But it’s tough to change human habits unless you’re trained to look at things differently, as many do who practice the Elliott Wave Principle over many years. But even those that do can often fall into the traps.

Mainstream EW practitioners are labelling the U.S. stock market’s uptrend from the financial-crisis lows of 2009 as ending a five wave impulse pattern into the 2018 highs. Even though we sympathise, this doesn’t make sense when taking a macro-view alongside so many other global indices, those traded in Europe, Asia and many Emerging Markets. It neither fits together with other asset classes like COMMODITIES.

Elliott Wave and the Final Commodities Cycle

Since early-2010, following several months of stock and commodity market gains, we’ve identified an upcoming ‘INFLATION-POP’ within the multi-decennial deflationary cycle. That would ultimately see many U.S. and global stock markets make new record highs into the next decade along with commodity markets. Well, that process hasn’t finished yet!

Commodities markets are forecast significantly higher in 2019 into the next few years, extending the next phase of the ‘INFLATION-POP’. For this reason this next phase is going to be HUGE because it’s the final sequence of the cycle. Consequently it’s going to be important to sift through the different commodities and their equities to see which maintain outperformance and those which will simply limp higher. But rest assured, this next huge advance is coming!

New Commodities 2019 Video – PART II/III

We’ve amassed over 75 commodity charts from our EW-Forecast database in this year’s Commodities 2019 video. As a result each one provides a telling story into the way Elliott Wave price trends are developing in this next INFLATION-POP’ phase of cycle development. Also we’re taking a look at some very specific patterns that span the entire SUPER-CYCLE. Explaining why the super-cycle began from the GREAT DEPRESSION lows of 1932 and not from the lows of 1999 and how this ended in 2006-2008. And why the multi-decennial corrective downswing that began soon afterwards is taking the Elliott Wave pattern form that it is.

Furthermore, we’re updating some amazing cycles in the US$ dollar that you’ve simply got to see. Plus others for the CRB-Cash index which begins from the year-1760 (yes, 259 years ago!), Copper, Zinc, Gold, Silver and Crude Oil. Now that’s an amazing outlook. Last year’s forecasts were so accurate, it’s like having your very own crystal ball! And there are huge implications for the price development of Energy prices in 2019. Above all the real give-away that corroborates our theme is revealed in the Elliott Wave pattern development of the XLE Energy index – it’s a must-see!

We invite you to take this next step in our financial journey with us. Video subscription details are below. Just follow the links and we’ll see you soon!

Most sincerely,

Peter Goodburn
Founder and Chief Elliott Wave Analyst
WaveTrack International

Contents: 69 charts

• CRB-Cash index + Cycles
• Copper + Cycles
• Aluminium
• Lead + Cycles
• Zinc + Cycles
• Nickel
• Tin
• XME Metals & Mining Index
• BHP-Billiton
• Freeport McMoran
• Antofagasta
• Anglo American
• Kazakhmys Copper
• Gold + Cycles
• GDX Gold Miners Index
• Newmont Mining
• GoldCorp Inc.
• Barrick Gold
• Agnico Eagle Mines
• AngloGold
• Silver + Cycles
• XAU Gold/Silver Index
• Palladium
• Platinum
• Crude Oil + Cycles
• Brent Oil
• XLE Energy SPDR Index

CONTACT US NOW VIA EMAIL – SELECT YOUR PACKAGE

Single Video – *$48.00 – PART II Commodities Video 2019 (Jan. ’19)
Triple Package offer – *$96.00 (saving 33%)! – PART I – PART II – PART III (Jan. – Feb. ’19)

Each video runs for at least 1 hour 20 minutes and it’s packed with SPECIFIC Elliott Wave price-forecasts (the Commodities Video is already 1 hour 58 mins. long!).

*(additional VAT may be added depending on your country – currently US, Canada, Asia have no added VAT but most European countries do)

BONUS! Each of the 38+ charts. The Commodities Video Outlook 2019 contains 70 charts already. illustrated in the VIDEOS will be created into a .pdf document/report and sent to you so that you can always keep these to refer to!

PART III will be available in a few weeks’ time (February/March 2019!) – we’re working on it!

HOW CAN YOU RECEIVE THE VIDEO FORECAST?

To receive your VIDEO UPDATE please click here to contact us.
– Please state if you wish to purchase the SINGLE VIDEO – Commodities Video 2019 for USD *48.00?
– Or opt for the TRIPLE PACKAGE for USD *96.00 in total?
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– Alternatively, we can process credit card payments for you as well – please contact us. Thank you.

*(additional VAT may be added depending on your country of residence. Currently, the US, Canada, Asia have no added VAT. However, most European countries do)

We’re sure you’ll reap the benefits – don’t forget to contact us with any Elliott Wave questions – Peter is always keen to hear you views, queries and comments.

Visit us @ www.wavetrack.com

New Stock Index Video 2019 Released! Part I/III

by WaveTrack International| January 1, 2019 | No Comments

Stock Index Video 2019 Part I/III

2018’s 4th WAVE CORRECTION APPROACHING A TERMINAL LOW IN Q1 2019!

This report combines ELLIOTT WAVE with updated SENTIMENT & ECONOMIC INDICATOR STUDIES

We’re pleased to announce the publication of WaveTrack’s Annual 2019 video updates of medium-term ELLIOTT WAVE price-forecasts. Today’s release is PART I, Stock Index Video – Parts II & III will be published during January/February.

• PART I – STOCK INDICES
• PART II – COMMODITIES
• PART III – CURRENCIES & INTEREST RATES

2019 Begins With More Declines – Terminal Lows by Q1-2019!

It looks like 2018 set quite a few records! The exponential advance that carried over from December 2017 into January ’18 finally reached a terminal peak on January 31st at 26616.70, Dow Jones (DJIA) and 2872.87, the S&P 500 – both then staged an inverted ‘V’-shaped reversal decline that initially shaved -4.6% off values. CNN reported it was the ‘scariest day on Wall Street in years…the biggest decline since August ’11…the Dow plunged almost 1,600 points – easily the biggest point decline in history during a trading day’. That was only the beginning though! – declines continued through February until it formed a low 2-weeks later but by that time, indices were down by -11.8% per cent.

Volatility continued afterwards – it only took another 2-weeks for the S&P 500 to trade up by +10% per cent – which was just prior to a downswing into the early-April lows, a decline of -8.8% per cent! By that time, sentiment turned really bearish – Investors Intelligence reported that ‘Bulls’ declined from 47.6 to 42.2 which was the lowest bullish reading since right before the US presidential election of November 2016. The number of ‘Bears’ rose marginally but remained at a low historical figure of 18.6.

What did the markets do next?

They ran higher albeit at a more modest pace but advancing by +15.0% per cent until it reached the late-September/early-October highs – then bam! The Dow and S&P collapsed lower.

USA Today reported ‘the U.S. stock market suffered its biggest October decline since the 2008 financial crisis, prompting shaken investors to reassess the staying power of a bull run that began more than nine years ago’. Following rallies into November, markets declined again in early-December. London’s Financial Times reported ‘Volatility leaves Wall Street set for worst December since Great Depression’. Christmas Eve’s (December 24th’s) decline was particularly severe as the Dow (DJIA) gapped lower by 667 points delivering a -19.8% per cent psychological punch from October’s high. The S&P 500 registered a decline of -20.2% per cent, the threshold that many economists define as a ‘bear market downtrend’.

Since those lows, the major indices have recovered by +7.5% per cent.

Drivers & Sentiment

The volatile price-swings of 2018 and the net declines from January’s peak are blamed on the Federal Reserve’s continued monetary tightening and interest rate hiking programme, U.S. President Trump’s trade war with China and its allies and concerns of a global economic recession forewarned by the severe flattening of the U.S. yield curve.

We know just how scared the markets are right now through various sentiment readings. The latest data from AAII showed bulls collapsing 17pts to only 20.9 from the previous week’s level of 37.9. That was the lowest figure since May ’16 – wow! Then on Dec. 19th, Investors Intelligence reported Bulls declined from 46.7 to only 38.3 although most of this downsizing went to the middle-voting with Bears rising 1pt to 21.4.

Snippets of Bank of America/Merrill-Lynch’s fund manager survey for December have appeared on the internet. Highlights include a reading of ‘extreme bearishness’ in equities, a huge jump from long-equities which is now negative -15ppt to long bonds at +23ppt and defensive trades in Consumer Staples at +13ppt (approx.). What does this tell us? – it suggests the equity/stock market is priming itself for a major low although the report itself says that it does not consider its readings as bearish enough to trigger a buy signal!

Review – 2018

With such volatile price-swings over the last year, you might think they’re impossible to predict, but in actual fact, the opposite is true! – THEY ARE PREDICTABLE!

Ray Dalio, the American billionaire and hedge fund manager of Bridgewater Associates sent out an e-mail to clients in December. It had this to say: ‘As you probably know by now, I believe that everything (i.e., all reality) works like a machine with cause-effect relationships that drive what happens, and that to be effective it’s essential to have a good mental model of how those machines/realities work and to have good principles for dealing with them well’. Sounds like an Elliott Waver to me! – ha! But in reality, Ray Dalio looks through the economic lens model – productivity growth, the short-term/long-term debt cycles in coming up with his concept of how the future looks.

But our resonance-signature prefers to work with the same mechanistic principles of ‘cause-effect’ using a more fluid, non-linear/fractal methodology – the ELLIOTT WAVE PRINCIPLE. This model has correctly identified almost all the price-swings of 2018 –

What Next? Preview for 2019 – U.S. Benchmark Indices

There’s a lot of competing aspects to consider this year and to gain a realistic glimpse of what’s to come, we’re going to have to separate the proverbial wheat from the chaff. That means being unbiased and relying on the facts.

The dominant Elliott Wave theme is that September/October’s highs ended a five wave impulse uptrend that began from the financial-crisis lows of Oct.’08/March ’09 – but is this correct? If the S&P 500 and Dow Jones indices are analysed in isolation, then there is a reasonable chance this ended a five wave ‘structure’. But when examining the same pattern in log-scale and overlaying Fibonacci-Price-Ratio analysis to verify, the pattern begins to degrade – no confirmation is forthcoming.

Back in year-2000 at the height of the dot.com boom and several years later at the highs of October 2007, developed market indices formed corresponding terminal highs with Emerging Markets and Commodities – positive corrections combined with terminal Elliott Wave uptrends formed at the same time. They declined together in corrective synchronisation in the sell-offs that followed. But synchronised EW-pattern highs never happened in 2018. In fact, Emerging Markets and Commodities are still engaged in five wave uptrends that resumed in early 2016 and are far from complete. Yes, they began corrective downswings in 2018 but that’s all. But that means the secular-bull uptrend for U.S. and other global indices is still in upside progress!

This Year’s Stock Index Video Forecast Focus

This year’s 2019 Elliott Wave forecasts takes an updated look at these disparities but aligning them into a synchronised process over the next two-year period. Over 60 charts illustrate the intricate relationships between the U.S., European and Asian/Emerging markets. They combine to tell the same story – we’ve haven’t seen a major peak in the secular uptrend just yet! And even if you have doubts, take a look at some of the sentiment and economic indicators that form part of the holistic viewpoint – the Elliott Wave overlay is pretty convincing!

Worst-Case Scenario

The Stock Index Video 2019 wouldn’t be balanced without a look at the more obvious Secular-Bear scenario. As a result, we’ve added some important slides into the mix. What this does is focus the negation levels at which point a nemesis decline is confirmed. For U.S. indices, price levels would need to break below the Feb.’16 lows whilst unfolding into a five wave impulse pattern to confirm the secular-bear scenario. So let’s see!

European Indices

One of the key aspects to the continued secular-bull uptrend is realised from examining the benchmark Eurostoxx 50 index. Its 2015-16 decline unfolded into a typical THREE WAVE CORRECTIVE PATTERN, i.e. a zig zag. Hence, the following advance into the Nov.’17 high didn’t break above the 2015 high. Consequently, this means there’s still a lot of upside potential to come over the next 18-24 month period, albeit European indices underperforming in 2018.

Emerging Markets + Asia – Australia – Japan

Emerging Markets along with many benchmark commodity markets are unfolding into the ‘INFLATION-POP’ schematic first postulated in these reports back in year-2010. Some indices haven’t broken above the old 2010-11 highs yet. However, this is again another strong indicator that secular-bull uptrends remain engaged to the upside.

New Stock Index Video 2019 – PART I/III

This ANNUAL 2019 VIDEO UPDATE for STOCK INDICES is like nothing you’ve seen anywhere else in the world. It’s unique to WaveTrack International, how we foresee trends developing through the lens of Elliott Wave Principle (EWP) and how its forecasts correlate with Cycles, Sentiment extremes and Economic data trends.

We invite you to take this next step of our financial journey with us – video subscription details are below. Just follow the links and we’ll see you soon!

Most sincerely,
Peter Goodburn
Founder and Chief Elliott Wave Analyst
WaveTrack International

Contents for the Stock Index Video – 68 charts

S&P 500 + cycles

Dow Jones Industrial Average + cycles

Russell 2000

Nasdaq 100

DJ Transportation Average

DJ Utility Index

S&P Price/Book Ratio

S&P Price/Sales Ratio

S&P CAPE P/E Ratio

VIX Volatility Index

AAII Bullish Sentiment

NYSE Advance-Decline

Consumer Sentiment

US GDP data

Eurostoxx 50

Xetra Dax 30

FTSE-100

MSCI Emerging Market

MSCI BRIC

Bovespa

Russia RTS

Sensex

MSCI China

Shanghai Composite

China Enterprises

MSCI Hong Kong

Hang Seng

Singapore Straits

Taiwan SE Weighted

ASX 200

Nikkei 225

Read more «New Stock Index Video 2019 Released! Part I/III»

Merry Christmas and Joyous, Prosperous and Peaceful 2019

by WaveTrack International| December 19, 2018 | 2 Comments

Merry Christmas & a Joyous New Year 2019!

We share one sacred planet,
the warmth and light of one beautiful sun,
the same air, earth, water and fire…
we are but timely custodians of these finite resources for the next generation to come…

Yet, in this season we are reminded that one resource we all share and need multiplies by giving…

LOVE

So we hope that wherever you are and whatever your faith, that your Festivities and New Year will reveal the many treasures of Peace, Love and Abundance.

P.G. & the WaveTrack Team

Announcement for our EW-Compass Subscribers

Christmas/New Year Schedule

This week’s Elliott Wave Compass Reports will be the last reports published for 2018!That’s Wednesday/Friday’s reports, Dec. 19th/21st ahead of the Christmas Festivities. The next EW-Compass will be published on Wednesday 2nd January 2019. If you have any questions next week, please send them in. We’re still here but working to meet deadlines for the publication of our annual 2019 Elliott Wave forecasts.

The extent of tracking all four asset classes, so many contracts has expanded exponentially over the last few years. Mainly, driven by the demand from you, our customers! This has necessitated creating all the Elliott Wave charts into a THREE PART VIDEO SERIES. As a result Part I will focus on Stock Indices, Part II Commodities & PART III Currencies & Interest Rates.

Seems like Part I might even be ready before year-end. Therefore, watch out for another e-mail message from us soon! Parts II & III will be published in January/February!

SP500 + Nasdaq 100 = Bullish!

by WaveTrack International| December 10, 2018 | 1 Comment

SP500 and Nasdaq 100 holding above Oct/Nov. lows – Bullish!

The SP500 has been marked lower overnight. But current selling is expected to dissipate with levels holding above the late-October lows. However, then pushing higher over next few weeks into year-end

Read more «SP500 + Nasdaq 100 = Bullish!»

Elliott Wave Theory Bullish – Dow Theory Bearish

by WaveTrack International| November 27, 2018 | 6 Comments

Dow Theory vs. Elliott Wave Theory

The Dow Jones Transportation Average is signalling a ‘Buy’ signal alongside the S&P 500 and Nasdaq 100. In contrast, Dow Theorists see downside potential if October lows are broken. Various sentiment metrics show extreme bearishness. However, we consider this a good bullish contrarian signal

Read more «Elliott Wave Theory Bullish – Dow Theory Bearish»

Nasdaq 100 Heading for Major Support

by WaveTrack International| November 21, 2018 | 3 Comments

Nasdaq 100 Breaks October Low but Heading for Major Support

Tuesday’s early trading sees the Nasdaq 100 futures attempting to break below the October low of 6580.50. This simply extends the early-October decline into a five wave diagonal pattern. A major low is being approached towards 6457.70-6416.00+/-.

Read more «Nasdaq 100 Heading for Major Support»

STLG/USD Declines Following Cabinet Brexit Approval

by WaveTrack International| November 15, 2018 | No Comments

Wednesday night’s/Thursday morning’s news confirms U.K. Cabinet approves Prime Minister Teresa May’s Brexit plan. But rumours circulate over a ‘vote-of-no-confidence’. This would challenge her continued leadership. STLG/USD declines hard but tests downside support above 1.2696

Read more «STLG/USD Declines Following Cabinet Brexit Approval»

NYSE Composite Index – Latest Development

by WaveTrack International| November 6, 2018 | No Comments

NYSE Composite Index – Fib. 100% Equality Ratio in Waves (iii) – (v) – No ‘Extended’ Wave

The Elliott Wave pattern development within the third phase of U.S. stock index declines during September/October’s sell-off varied according to each index’s performance from earlier this year. For example, the large-caps like the SP500 and Dow Jones (DJAI) declined into three wave patterns. In zig zags to be precise, from the late-Sep./early-Oct. highs as wave [c] within a developing triangle. These lows terminated in late-October but above the February lows. In this way reflecting their outperformance during April’s strong advances that broke above the January highs.

Other indices like the underperforming Russell 2000 small-cap index declined during September/October’s sell-off into a five wave impulse pattern. This reflected its underperformance and an entirely different corrective pattern. In this case, a running flat, unfolding from last January’s high.

The NYSE Composite index was one of the underperforming indices for this year. It unfolded into a zig zag pattern, [a]-[b]-[c] and one of the exceptions by breaking below the Feb’18 lows in wave [c] ending at 11820.32 – see fig #1.

Wave [c] unfolded into a necessary five wave impulse pattern from September’s high of 13261.76 subdividing (i)-(ii)-(iii)-(iv)-(v). What was interesting from a Ratio/Proportion basis was that there was no ‘extended’ wave in this sequence. Rather, waves (iii) and (v) measured equally by a fib. 100% equality ratio. That’s somewhat unusual because R.N. Elliott stated that one wave must ‘extend’ or measure larger than the other two. But occasionally, this hasn’t occurred as this example proves. Although this is statistically uncommon, it’s enough to qualify his statement as a ‘guideline’ rather than a ‘rule’.

NYSE Composite Index – Looking Ahead

With this year’s zig zag decline out of the way, the NYSE Composite index, like the others, can now begin a multi-month recovery, extending the bull market, impulse uptrend that began from the Feb.’16 lows.

Shorter-term, the advance from 11820.32 has unfolded into an intra-hourly five wave impulse pattern ending last Friday at 12449.93 as minuette wave [i]. Wave [ii] has since begun a three wave counter-trend correction but this remains incomplete. Await some downside pull across the U.S. mid-term election results before the trend resumes higher.

What has the SP500 and Nasdaq 100 in common?

by WaveTrack International| November 1, 2018 | 5 Comments

Three Wave Zig Zag Decline Completed for SP500 + Nasdaq 100

The SP500’s decline from September’s high has completed a three wave zig zag corrective pattern into last Monday evening’s low of 2603.00. This development changes this year’s expanding flat into developing triangle pattern. Turning this into a bullish outlook from current levels through to year-end and into H1-2019. The Nasdaq 100 follows the same pattern. Ending into zig zag from October high at 6580.50 and again turning this into a bullish outlook into year-end.

This year’s declines from January’s highs have been labelled as unfolding into an expanding flat corrective pattern as minute wave 4. However, it is now changing into a triangle. See latest EW-Compass Report.

The original expanding flat patterns were labelled [a]-[b]-[c], subdividing [3]-[3]-[5]. They were requiring a five wave downswing from the late-September/early-October highs. Hence, for the SP500 from 2940.91 (cash) and 2947.00 (futures) and for the Nasdaq 100 from 7700.56 (cash) and 7728.75 (futures). But we’ve detected a visible three wave zig zag pattern unfolding in wave [c]’s decline rather than a developing five wave sequence. The two downswings from 2947.00-2712.25 and from 2824.25-2603.00 measure equally. In case of the SP500 by a fib. 100% equality ratio (see SP 500 – inset left) and for the Nasdaq 100 from 7728.75-6907.75 and 7368.50-6850.50 (see Nasdaq 100 – inset right). This fits the characteristic of the zig zag. It therefore ends wave [c] but within a developing triangle because a triangle is labelled [a]-[b]-[c]-[d]-[e] but importantly, subdivides [3]-[3]-[3]-[3]-[3].

Conclusion

These zig zags confirm a good recovery can begin as wave [d] within the triangle. As a result, the SP500’s upside targets are aiming towards 2855.75+/- and Nasdaq 100’s towards 7544.00+/- into year-end, perhaps into January. Looking ahead, the triangle confirms minute wave 4 and upon completion, wave 5’s push to record highs.

Bi-weekly updates on the SP500, Nasdaq 100, US Dollar Index, Crude Oil, EuroStoxx, Russell 2000, Dow Jones 30, Dax, ASX200 and more! Don’t miss WaveTrack’s regular updates in our bi-weekly EW-Compass Report! Ensure you’re tracking our Forex forecasts – subscribe online for the EW-COMPASS REPORT.

Visit us @ www.wavetrack.com and subsribe to our latest EW-COMPASS report!

Category: Elliott Wave, Nasdaq 100, Nasdaq100, S&P 500, SP500, Stock Index

US$ Dollar Gains After Fed – Shouldn’t Crude Oil Also Decline?

by WaveTrack International| September 28, 2018 | No Comments

US$ Dollar Gains After Fed – Shouldn’t Crude Oil Also Decline?

Following Wednesday’s Federal Reserve interest rate hike of 0.25% to 2.25%, the US$ dollar has pulled higher by 1.23% per cent from 93.95 to 95.11. The US$ dollar looks set to continue higher over the next week or two as the finalising sequence of the expanding flat pattern (see Twitter post 26th September 2018).

Now what about Crude Oil?

But the intriguing question now relates to Crude Oil – see fig #1.

US Dollar Index vs. Crude Oil – Elliott Wave by WaveTrack International

As you can see from this analogue, there’s currently a high-negative correlation with the US$ dollar index. Even price-amplitudes are closely aligned. The US$ dollar index pulled higher through Wednesday/Thursday and continuing this advance today (Friday). However, Crude Oil has failed to respond lower in reaction to the stronger US$ dollar. Is there any obvious reason for this breakdown in the correlation?

Crude Oil – 120 mins.- Elliott Wave by WaveTrack International

From an Elliott Wave perspective, the exact same Elliott Wave count is applied to Crude Oil, where an expanding flat is unfolding from Crude Oil’s early-September high of 71.40 – see fig #2. Labelled [a]-[b]-[c]. Wave [a] declined into a zig zag ending at 66.86 on September 7th. And was followed by a double zig zag upswing as wave [b] into the Sep. 25th high of 72.78. If correct, as we believe, then it really should decline now as wave [c] towards levels of 66.20-65.80+/-.

Conclusion

Perhaps it’s simply a case of playing ‘catch-up’. However, delays in these types of set-ups are not uncommon. One might view the delay as a complete breakdown of the negative correlation. In this case, Crude Oil’s underlying uptrend is so strong that it’s able to withstand a shorter-term US$ dollar rally. But often, trading opportunities exist where the divergence is simply delayed. Consequently, Crude Oil will perhaps suddenly, trade sharply lower.

Differentiation between the two possibilities comes down to the qualitative assessment of Crude Oil’s pattern. September’s advance does certainly conform to a double zig zag pattern (66.86-72.78). Therefore, the probability that it can still decline as wave [c] to 66.20-65.80+/- is increased.

Risk/Reward becomes a factor in whatever trade set-up is taken. Ensure close stops are applied, e.g. Crude Oil above the fib. 38.2% extension level of wave [a]’s trading-range at 73.15 would probably negate this high area as wave [b] of the expanding flat.

Bi-weekly updates on the US Dollar Index, Crude Oil, SP500, EuroStoxx, Nasdaq 100, Russell 2000, Dow Jones 30, Dax, ASX200 and more! Don’t miss WaveTrack’s regular updates in our bi-weekly EW-Compass Report! Ensure you’re tracking our Forex forecasts – subscribe online for the EW-COMPASS REPORT.

Visit us @ www.wavetrack.com and subsribe to our latest EW-COMPASS report!

Category: Crude oil, crude oil price chart, Elliott Wave, US$ Index, US-Dollar Index

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