EURUSD 27th December, 2013

The euro moved upwards as expected by both of our counts. However, it continued upwards in a very impulsive manner, shooting through all of our targets as well as the invalidation points of both counts.

This development may seem surprising, but it actually fits very nicely with another count we had in store.

We’re updating our counts to reflect the most recent price action and to present tighter targets and invalidation points.

Hourly Main Count

– Invalidation Point: 1.3892
– Confirmation Point: –
– Upwards Target : 1.3792 – 1.3830
– Wave number: Micro 2
– Wave structure: Corrective
– Wave pattern: Zigzag, Flat, or Combination

Elliott Wave chart analysis for the EURUSD for 27th December, 2013. Please click on the charts below to enlarge.

Main Daily Wave Count

eurusd-daily

eurusd-daily

The bigger picture sees the euro within primary wave B to the upside, and within that in intermediate wave (C), and within that in minor wave 3.

Within minor wave 3, minute waves i unfolded as an impulse labeled minuette waves (i) through (v), and minute wave ii unfolded as a zigzag labeled minuette waves (a), (b) and (c) which retraced 50% of minute wave i.

Minute wave iii is forming an extension. Within it, minuette wave (i) unfolded as an impulse labeled subminuette waves i through v, which are well contained within their Elliott channel. Within it subminuette wave iii unfolded as another impulse labeled micro waves 1 through 5.

This count expects that minuette wave (ii) is now unfolding towards the downside, most likely as a zigzag. This will be initially confirmed by a break below the lower trend line of the channel drawn around the subdivisions of minuette wave (i).

The MACD indicator strongly augments this count by showing multiple bearish divergences. While price has made higher and higher tops, momentum is consistently decreasing, forming lower highs.

In terms of candlestick patterns, the most recent bar shows a formidable “shooting star” pattern, which is a very strong bearish signal that further augments this count.

At 1.3664 minuette wave (ii) would retrace 38.2% of minuette wave (i), then at 1.3523 it would retrace 61.8% of its length.

This wave count is invalidated by movement below 1.3294 as minuette wave (ii) may not move beyond the start of minuette wave (i). It’s also invalidated by movement above 1.3892 as within a zigzag a B-wave may not move beyond the start of the A-wave.

Main Hourly Wave Count

eurusd-h1

This count sees that, within the impulse of minuette wave (i), subminuette waves i through iii unfolded normally.

Subminuette wave iv unfolded as a protracted contracting triangle labeled micro waves A through E.

Micro wave A formed a double zigzag, micro wave B formed another double zigzag, micro wave C formed a triple zigzag, then micro waves D and E both unfolded as regular zigzags.

Once subminuette wave iv was complete, subminuette wave v moved in the typical manner expected from a post-triangle thrust. It shot up to reach and exceed the origin of the triangle, before immediately reversing and retracing over 3/4 of its advance, as part of the retracement in minuette wave (ii).

Minuette wave (ii) is most likely unfolding as a zigzag labeled subminuette waves a, b and c.

Within subminuette wave a, micro wave 1 seems complete, although it may still move further downwards.

This count expects that micro wave 2 will start unfolding towards the upside. Assuming micro wave 1 is indeed complete, then at 1.3792 micro wave 2 would retrace 38.2% of micro wave 1, then at 1.3830 it would retrace 61.8% of its length. If micro wave 1 moves further down before reversing, then these targets should be readjusted accordingly.

At this point, neither the MACD nor candlestick analysis can give any serious insights to either support or contradict this count, so we’ll have to wait for further development before making use of these two tools.

This wave count is invalidated by movement above 1.3892 as micro wave 2 may not move beyond the start of micro wave 1.

4 thoughts on “EURUSD 27th December, 2013”

  1. “This development may seem surprising, but it actually fits very nicely with another count we had in store. ” what is surprising is that you had it in store but decided to share it with us once all your bearish counts over the last 3 weeks got blown out one by one. and the above speaks volume about the predictive value of your work. Tamer, anyone can get it wrong. I do and so do you, but to start a commentary having been so wrong for so long with “hey paying folks its all good I had another count that fits the past action but I didn’t share it with you before” is a bit too much for my like.

    1. Hi Gabriele,

      First of all, let me say that I fully appreciate and respect what you said, and I completely understand where your frustration is coming from. And I hope you’ll allow me to clarify what happened (and why it happened)…

      At any given time, I keep about 4-5 different counts, some days even as many as 8. But of course, I can only discuss 2 at most, since any more than that would not only be too much, but it would also be very useless and paralyzing in terms of trading potential.

      So I have to decide which two counts I should discuss, and I try to base this decision on a number of factors, such as which counts fulfill the highest number (and quality) of Elliott Wave rules and guidelines, as well as which ones pose less risk (in terms of their invalidation points and targets), among other factors. And every day, as the market patterns develop and new data comes in, I have to re-evaluate my choices. This happens at several time frames simultaneously.

      So taking yesterday for example. If you take a look at the weekly analysis, you’ll notice that even though I didn’t discuss the triangle scenario, I made sure that the alternate weekly count considered the upwards potential. And in fact, even though the details of the count were different than what price finally revealed, the target I specified there was reached “exactly to the pip.”

      So what about the daily count? Here again we face the problem I mentioned earlier, of my being forced to discuss only two counts at most. The alternate daily count also considered the upwards potential for the euro, but I opted for a more “conservative” count than that of the triangle. This was partly because the holidays aren’t usually very active, and I wanted to make sure the targets I specified would provide at least some opportunity for the members. Besides, the other indicators didn’t paint a clearer picture.

      So I guess the question I ask myself daily is: “Between two counts with equal probabilities, is it better to discuss the one whose targets have a better chance of being reached, or the one whose targets are more profitable but much further away?” Up till now, I prefer the first option, but if you (and other members) would prefer the second, I’d be happy to oblige.

      Again, let me assure you that (I think) I understand the reason you’re upset. It probably sounded like I was trying to “hide my mistake” by saying that I had a count that explained it but I hadn’t shared it. I would definitely be angry if somebody said that to me, especially if I was paying them for doing exactly that. But honestly, that’s not the case at all. I guess what I’m trying to say is, since I’m always limited by the constraints of how much I can share in any given day, I try to make the best of it by providing counts with targets that can actually be useful. Naturally I don’t always succeed, although I would like to think that the accuracy of the specified targets has been largely good. But that of course isn’t something that “I” can judge.

      I hope I managed to get my point of view across to you, and I definitely apologize for sounding like a know-it-all (which was never my intention). More importantly, I’d very much like to listen to any and all suggestions you have about how to improve the analysis and make it more useful and accessible to you and to other members.

      Sorry for the lengthy response, and I wish you a fantastically happy new year! 🙂

      All the best,
      Tamer

  2. Dear Tamer,
    thanks for the effort of such long reply.
    I personally do my own counts and subscribe “just in case” I am missing something big, sort of things.
    My counts sometimes are a match to yours, sometimes they are not.
    My earlier comment was not on the back of frustration, given that I trade as I see fit, rather than on the back of your work.
    As a result I have never complained about losses when your counts were similar to mine and wrong, and also never complimented when I make money and both our counts are correct.
    However, and this is the point I am not selling my work, but you are.
    So the way I see it, and let’s agree to disagree on this, you either post a count or it is very annoying for you to be wrong and claim ex post, that nonetheless you had a count that fits.
    Ex post I can explain pretty much everything that goes on in this world, including EURUSD using EW.
    I personally think, and I have already expressed this view in previous posts, that you are trying to over analyse every move and often miss the big picture.
    I have also expressed my view about the publishing time of your analysis, whereby given that EURUSD “pauses” after the NY closing time, the analysis should be available shortly after.
    While I appreciate that EURUSD has been lately much more complex to analyse than let say the S&P, I think that you could draw some inspiration by the work of Tony Caldaro, who publish his analysis and charts shortly after the closing bell in NY, without going in the granular details of nano and micro waves, and then goes into a much more detailed work ( with a long term prospective) over the week end.
    best regards,
    Gabriele

    1. Dear Gabriele,

      We don’t even have to “agree to disagree,” because I actually do agree with you. That *was* annoying, and I sincerely apologize for it.

      I generally attempt to update and publish the analysis shortly after the NY Close as well. And while I do see the merit of not always going into too much detail too early, other members have expressed a strong desire to access this level of detail for educational purposes.

      Nonetheless, you do raise some very useful points, and we’ll definitely discuss how we can implement them in a way that achieves a finer balance and more usable analysis.

      Thanks a lot for your time and insight, Gabriele… And I sure hope you keep ’em coming! 🙂

      All the best,
      Tamer

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