Thread designed to record set-ups and targets on index and FX pairs.
'A market is only your enemy until you understand it, then it becomes your best friend.'








Any questions, please feel free to ask.

From time to time i may openly state an opinion regarding direction of a set-up and wish to add that in no way am i recommending a trade. I am sometimes only in trades for a matter of minutes and can't always update as to entry/exits taken.
As always, markets are dangerous places to be and must be respected as such. Always use stop losses and never over-leverage; 3% of your pot as a maximum per trade. As always, YOU are responsible for your own trades! Happy pip hunting!

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Davai - 24 May 2012 10:11 - 8240 of 8247

My current thoughts are with my original chart of last night. We have just played out an abc 4th, which was far longer in timescale due to overnight futures. We head up for a 5th and then back down in an abc corrective (probably tonight), this would mean much higher early next week;



(with regards to above comments; i forgot that it is Thursday today! Tomorrow should be a big up day, prob Mon/Tues for reversal back down, but too early to tell just yet...

Update to above, (as of last night);



This morning has also seen a spritely start!

Ok, was expecting a normal 5w impulse move for C, but now looks more likely a diagonal;

(copied across from the other thread)

Davai - 26 May 2012 10:15 - 8257 of 8257

Look how easily the pattern changes hinged on the length of the (iv)th, its now likely to be an expanding diagonal;



I do have a system target of 1348, but watching with interest as we are in an ABC counter-trend move and thus i don't have enough evidence yet to call that with conviction... If it does reach that level, it will surely reverse thereabouts...

The Loonie also looks like down from the open on Sunday night, (dollar weakness = markets up);

NzdUsd leading the way tonight and similar to the above index chart predictions;

Update to above;

Remember this?;

Davai - 27 Apr 2012 19:48 - 65 of 107

the Dow plan;



Well i think we may have reached the bottom, (speculative for sure right now and need evidence)

Davai - 10 Jun 2012 22:18 - 8343 of 8343

Here are my current thoughts as to the Dow. The FIB levels are reproduced from the length of 'A' (not seen to the left of the chart), it looks as though we have completed a full ABC retrace within the uptrend, with the first part ('A') of the correction starting 27th March. This is of course, speculative, but the FIB levels have been deadly accurate for the whole of wave C.
I'm looking for the last Lower High (prev wave 4 as per chart), to be breached tonight/tomorrow for further confirmation, then we can look for a large ABC retrace to begin. This can be sharp/shallow, zigzag/flat or irregular, but if it forms a clear 3-3-5/5-3-5 and doesn't make a fresh low, we are in business for a Higher High to come in a month or so's time and higher for the rest of the summer at least...

Sound crazy with everyone expecting new lows with all the Spain/Euro probs??? Yep that's how it will catch everyone out. I would expect the ABC to be a deep zigzag, just to scare everyone, but if no LL, we are good to go.

here's the chart;

Well, after identifying the recent 5w advance, it is clear that it wasn't followed up by a typical ABC retrace (as per above). Instead, we got a faster 'B' wave pullback and another 5w advance ('C') to follow. This may have already completed, or perhaps have one last move up to go.
If this is correct and it certainly looks it right now, we could be about to start a very nasty sell off. Possibly a couple thousand points to come off of the Dow in the coming weeks...

Adding to that, the Euro appears to be rolling over. Time to look for a small 5-3 move (down and retrace)...

Cable should start to look sick soon too;

Now the Audi joins in, reflex point breached by a full pip, trend changes to short. Look for an ABC retrace back up now to get short;

Nzd, likely outcome;

Reflex point breached above (NZDUSD) and now the Loonie joins in... the evidence is growing;

Things looking ripe for some red today!

*edit* A day out with timing and some corrective moves completed by the looks. Markets want up and looks to be the real deal, so now over-rules previous posts. This will probably mean original plan, with a HH to come for the Dow...

Ok, lets try to show workings behind a great trade yesterday...

Firstly, here is a chart of the hourly Audi;



I could have shown a 4hr which would identify this as a complex corrective phase and the likelihood of us being in a 5 wave move ('C' wave).
We are nearing the end of this move (as per the chart). Here we can clearly label the move as the market is being very kind right now and literally signposting each move.
Once we have finished the powerful 3rd wave, we can look for an ABC 4th. In this instance wave 2 was short and simple, thus we can expect alternation and a longer more complex wave 4. I have attempted to label that in the chart below, but first lets observe a couple of things. Draw a line connecting the end of waves 2&4, then drag a parellel line across to the end of wave 1, (blue lines), this will give a likely target for the end of the whole 5 waves... In this instance i believe we may get a second touch as its unlikely that we have finished the move and have just encountered our 4th (subwave) of the 5th just before the close...

Now to look in more detail at the 4th wave and the break out into the powerful 3rd (subwave) of the 5th wave;



Here we can follow the structure of the 4th wave in a 5-3-5 ABC formation. Its even possible to clearly label the subwaves within the 5th wave of 'C'. This set us up for downside early on yesterday, (subwave 1 of the 5th), but after a&b (of subwave 2) and with the need for a corrective 'c' to come around the time of 'Non Farms', (I also had the Euro pegged to go up at the same time), so i wasn't expecting bad news. Surprise surprise, up we go. The Audi made a steep retrace, but couldn't breach the start of point 1 of course (stop placement). Once completed it was time to start subwave 'iii' (of the 5th). At this stage we don't know what shape it will take as 5th's can develop in many fashions, but once it started dropping sharply it was obvious it was impulsive, we would get a clean break of the flagline and likely drop in a strong move. Shorting the rise of the 'C' wave (of subwave 2) with stop above start of point 1 is a great trade. Equally shorting the break of the flagline, (bigger points risk, but more evidence)

Going back to June Davai it seems like all of your predictions were, err, wrong? No nasty sell off, entirely the opposite in fact.

True.... that's the purpose of the thread though to be fair... put it out there to be able to look back and learn from. To be fair, i generally only ever trade on small timescales and thus am only really interested in short term movements...

Apologies, I will try to get it right next time! )

All fair comments Davai, my post was more aimed at the inaccuracies of Elliot Wave Theory, give 10 practitioners the same chart and all 10 would have different outcomes :-)

Not going to disagree with any of that. Now... just recording some thoughts here;
They are that we have just completed a 5wave down and are now in an ABC retrace. Of that we are printing abc (of 'A'). System target is 12904, but obvious target would be 12920 (the 38.2% fib retracement level), before we start an abc 'B' back down...
I am labeling this as an expanding wedge. I brought my stop up to BE too soon (after system entry) and got stopped out to the exact pip on the downleg of 'D', this was exactly entry point, the market knows this and thus why it did a second retest of this point. Observation is to bring stop up to a pip below point 'B', thus reducing risk by two thirds, but staying clear of the probability of a stop out. If stopped then the entire set-up and thinking is invalid anyway, with risk at just one third of original entry, i should have been able to live with that.... I recognised the pattern merely 30 seconds after stop out, but PA had already risen and gone away from that level.... the trade had gone... I swear i will recognise it earlier next time!
Result; market went to target quite quickly without me onboard... pissed off? yes, but another feather in the cap as it were... carry on...



*Edit* In trying to determine the correct labeling, i am preferring some kind of double or possibly even a triple zigzag. Info says expanding triangles shouldn't occur in a 'C' wave and a diagonal would be contracting. PA also didn't conform within the lines, so a triple zigzag in an 'X' wave it shall be... same conclusion as to stop placement and same result with system target having now been met.