Back from hols and even more sunshine in Malvern, UK - it is really a wonderful place to live in the sunshine! Last week is easy to sumarise: we had anticipated a decline last week and we got one. I banked my shorts and started to go long anticipating a 'b' wave in 'e' of the triangle that appears on the daily chart. However, either 'b' was shallow and we are now in 'c' of 'e' or we are in wave 5 of 'a' of 'e'. Or something else completely, of course. For now, my early longs are looking a bit tragic, but overall, whilst price is inside the triangle, all is well.
Nothing has changed on the weekly chart, other than we got another 'sell the overbought momentum cluster' signal at the top of the screen. However, the loose triangle formation here is rolling around the 50% retracement line of the 'all time' high/low grid and such signals seem to be highlighting corrections not trend changes, at the moment. With the 10 year Hull rolling up the Gann grid 45 degree line, it just might be that price is going to keep going right, rather than down as indicated, but this is a long term chart and mostly for supposition and record, not trading.
The daily chart is showing a tighter range for the possible triangle, which would be of a lesser degree I think, if it completed as shown, and not the possible formation in the weekly chart. Perhaps a 'iv' in 3 to make my previous count too premature. Price is certainly rolling around the 25day and 50day FLD's; I have deleted the 100day and 200day FLD's to make the chart a little more presentable, but along with the 25 day, they are sat right under the price at present providing stiff support. The 100 day regression channel is holding bullish for now, but with price in the middle of the channel, there is room for manoeuvrings both ways. Both the 'b' & 'd' legs of the proposed triangle, hit the 200 day Hull, so that median line is significant I feel. If the next leg up takes that out, along with the 50day FLD (dark pink), expect a spike and pull back to retest above, with the next 'all-time hi/low' harmonic octave at 139.4910, being a reasonable initial target. The 100 day low looks in to me, as noted last week, as the triangle formation itself, petering out but PA will confirm, not me. I am still playing for a 'b' of 'e' up for now but as mentioned at the top, it might already have passed me by, leaving the triangle exit as the next move!
The 2hr chart is obviously looking messy as PA had been compressed for sometime now. However, in short, the momentum cluster in the sub-chart is oversold and we have the 12.5day, 25day and 50 day regression channels all aligned uphill, with their respective medians all at the 130.891 Harmonic Octave (blue line from the 2012 hi/low Gann grid in the daily chart). We have a new monthly high low Gann grid in play now and the 45degree line is holding price under the 12.5&25day trend lines (all red) with the 25 day (pink) FLD sat just under price action (along with the 100day and 200 day FLDs, not shown). I like the look of that 12.5day FLD peak in orange at 132.00 and for me that would be a great 'b' of 'e' wave target, if it held. Anything stronger, either way and this count is probably wrong. A break of the darker pink '50day FLD' would have price back above all the FLD's from 25day to 200day and I don't think the 12.5day would be much of a net with the momentum cluster like this.
So, I am staying long for now and hope for the triangle thesis to hold. More than happy to take spike out of the top, not so keen on out of the bottom! Good luck next week everyone and thank you for reading.
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