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30M AUDUSD Sequence from 12/7 - Analysis and Endpoint ForecastThe AUDUSD sequence we'll be looking at starts on the 7th at 12pm at the 30M time frame. To preface the analysis, I should mention that I'm using a counting framework called 'Magenta', as well as an 'event locator' to provide an objective foundation for our count, and a tool that automates the counting and tracks the processes we'll be analyzing... The current high of this sequence is .68138 and it may look like a single trend, riding and fluctuating the rising trend line, which by the way, is based on the low of the 2nd FCT (Fractured Counter Trend). (TIP: If you base you TL's on FCT points, you'll find that they're much more accurate. And fluctuating the TL is common behavior, esp. when the sequence/trend begins to wane...). So this sequence is actually a combo of 3 trends. The first runs the span of the large 131 pip highlighted box, the second runs from the high at point 37 to the low of the 57 pip box, and the third is in the process of playing out. How do we know this? In Magenta, there's a process called 'the cycle' that consists of a repeating 2/4/6 count. This count can have a prefix and postfix (also called type/antitype). The T/AT uses the values 6 and 4. These can come in X or X/X form and can repeat. So the values 4, 6, 8 (4+4), and 10 (6+4) are all valid 'types.' If we repeat 6 we get 12, which is the cycle (2+4+6) - so that wouldn't be considered a T/AT but just another repetition of the cycle. Trends have ways of communicating the type - which will always appear in the first or second pushpull (waves 1-4). In this sequence we see that the first FCT ends at point 4 then immediately goes into the second type value of 6 (points 5-10). A DMC (Double Marked Candle) ends the X/X type at point 10. Now the second rep of the cycle ends at point 26. So if we add our 6/4 onto that (now it becomes the 'antitype' - notice the elongating of the 4 compared to the 6 count...) we end at point 36 which is where another Magenta process ends - this one is called the 'prime' count. In this case it starts at 0 and repeats 12... hitting at 12, 24, then 36. We want to pay attention to points where processes converge... So this is what caused me to short this trend between points 37 and 38 at the level (.67913) and time indicated. The resulting drop may not look like much of a trend change, but technically it is. It contains a FCT (points 44 to 49) that runs in the opposite direction of the FCT's in the preceding trend. This makes it a downward structure. What's interesting about this move down is that it continues to use the 6/4 values from the previous trend. We're counting down now so point 37 is zero, 38 is '1', '6' hits at 43, we skip 44 since it's an FCT terminal, 45-48 is our 4 count, 49 is also a terminal and so is skipped, and the trend ends at the DMC low. Then, in a volatile move up, price regains the trend line, starting to fluctuate it once again... I've seen this happen before and when you have these downward and upward 'topping sequences' - they often use the T/AT from the larger sequence. If that happens here, we'll see a 6/4 move up (which I believe is currently happening). The 6 count looks to be spread over pushpull 1 (waves 1 and 2). The final box (far right) may be the final FCT, so our count skips the terminals... If point 56 is the FCT low, then we should see a 4 count and then a new high (absolute highs/lows are never counted in Magenta). We should then see a directional change for the entire sequence, breaking away from the current trend line. The size and length of future movements cannot be forecast with any existing framework, which is why I give no profit targets. But if it plays out as above and you decide to trade it, then enter as I did after point 37 - wait for a high, then a spot in the following candle where you know that another new high is not possible unless a new event is created (which would put us beyond our 4 count and invalidate the forecast). Place your stop 2 pips above the absolute high.
Short
by trendlab2
3
4H downtrend in AUDUSD possibly nearing completionWe are tracking two counting processes in this analysis: Prime & Cycle. The first is easiest to understand. We simply select a window that starts at the absolute top/bottom of the trend, and ends after the first fractured pullback ("FCT") completes. As you can see from the green label at the high, we can derive three numbers from this count. In this case they are: 16/14-8 (the 8 can reduce to 4 and 2 since all of these are even, but let's keep it simple and focus on the three...). The 16 is called the 'high prime,' the 14 is the 'low prime,' and 8 is our 'half prime.' The prime values imply that the market mind will use these to end the trend at a point where these values also line up with other processes... As you can see we're projecting a turn based on our half prime of 8 counted from the rightmost edge of the selection window. The second process involved is the Cycle. The Cycle is a 2/4/6 count that skips FCT terminals (most of the time). Actually, in this sequence, the terminals are counted since the low terminal at point 11 appears above the trend low at point 9. This is one of two situations we call a 'count-through.' So the first Cycle ends at the bolded 6 label. The second ends at, and lines up with, our half prime count of 8. What indications do we have that the Cycle will end there? Notice the DMC (Double Marked Candle) at point 6. This is a signal that can point either to A) the end of a Cycle (since cycles end at 6) or B) a 6-count to follow the end of a cycle. In this case, either A or B is a possibility. If A plays out we end at our half prime, and if B, we end at our low prime of 14. Please note that the projection implies a new and final absolute low after our counts of 6 and 8 are hit... For me personally, I would attempt to trade both situations. If I stop out on the half prime entry, it only makes the low prime entry more viable... This downtrend from the .65220 high also ties into the 1D time frame where an 'all primes' count ended at .61702 on Thursday, Oct. 13. So I don't think that low will be breached by this 4H trend. We should see new highs in the daily chart in the upcoming weeks (if the 'all primes' count holds)... As for stops and profit targets... I usually oscillate between a conservative and aggressive ATR based trailing stop, in this case it would start at the absolute low of the 4H trend. I don't use targets much because they are often arbitrary. There is no possible way of knowing what the next trend will look like before it happens... Even with all the above rules, markets have an extremely wide range of legit behaviors. The projection shown here is based on a relatively mature trend, not to say that it can't extend beyond what we expect, but after the first and/or second FCT forms, we've pretty much got all the info we need to make a good educated guess... Let's see how this plays out... enjoy! /r
Long
by trendlab2
Update to Seq End in EURUSD 4HOk, I've revised my analysis on this. I'll quickly go over this change... For Magenta counting rules please see my other posts... Basically I changed my analysis of the type, to a 4/6 (red tags, point C and the DMC in FCT 2). The cycle ends at point F so the antitype starts counting from there. This (the antitype) now lines up with the 12 count from our prime set instead of the 14 (point K). Looks like the low might be in for this sequence...
Long
by trendlab2
1
Possible Sequence End in EURUSD 4HOk everyone, let's try this again. I believe this sequence (from the Jan. 14 high in the 4H time frame) is near its end. First and quickly, allow me to explain the labelling... Green tags are location labels, not counts (as in Elliott wave counting). The other tags represent different processes playing out. Each process has it's own unique count. The red and blue triangles and squares (above/below the candles) are the countable points in the sequence. The orange lines show the 'count path' over areas that may be difficult to track. The red arrows are FCT's (Fractured Counter Trends) - these are important because some processes skip counting the FCT terminals. In Magenta terminology the FCT's are "pulls" while the trending parts of a sequence are "pushes." The main sequence here is called a 'cycle' - it's a repeating 2, 4, 6 count that usually skips FCT terminals (unless a 'count-through' signal appears). The bolded '6' tags are where the cycle ends. Any tag with a dot after the number (such as "1.") indicates a count that is in-between either 2 or 4 or 6. "SK" means "skip" (the count skips the terminal). The red tags form the 'type' which is mirrored at the end of a trend/sequence by the 'antitype' (red/gray tags). The antitype is always appended to the end of the cycle. Finally, the yellow or orange tags represent 'prime' processes which can be found at the pull 1 and/or pull 2 terminal. When a prime count converges with an antitype or another prime count, this can indicate a highly probable turning point (once the absolute high/low is made). The "absolute" endpoints of a sequence/trend are never counted in Magenta. Ok, I said all that to say this: Here's how this makes sense and why I believe a new low (below 1.11214) should be a great location to go long. We can draw a prime set from the A to C count or from A-G. Since our A-C count yields only 4, we'll use the A-G count which gives us a set of 14/12/6. That means that counts based on a combination of these 3 numbers, and their interaction with other processes, will end and turn the trend. At point K you can see we've counted 14 from point G. Why 14 instead of 12? Because 14 converges with our cycle end at point K (white/bold 6 tag). Now the end of a 2, 4, 6 cycle will not always turn the trend, what we call "partial cycles" can be appended to the cycle. So why do we think that, in this case, the trend will turn on 14 and 6? The answer has to do with the type/antitype process... Like primes, types appear within the first two pushpulls (waves 1-4), and the market mind has various ways of signaling the 'type.' Notice that at point D, in push 2, we get a candle with blue marks at its top and bottom. There are only two such candles in the sequence. These are called "DMC's" - Double Marked Candles, and they are often used to signal things or segment counts. So our suspicion is that this particular DMC is marking our type. The count from A to point D is 6. When the market points to a type of 6 that can mean one of two things. 1) The endpoint will appear exactly after a cycle terminates, or 2) the endpoint will appear 6 counts after the cycle terminates. If the second option where playing out it would match up with a 14/6 prime count. So if we get stopped out on this trade, we could just enter again at that point. But the odds may be better at point K. Why? There's another process that markets use to create meaning, it's called "Equivalence" or simply "EQ". EQ can occur in counter-trending or trending counts. Often it will be an FCT only count, but in this case, count the trending segments of the sequence... In push 1 we get zero, 4 in push 2, 4 in push 3, and 6 in push 4. Zero + 4 + 4 + 6 = 14. Fourteen is our high prime! So long story short, a number of process are coming together at point K... If you're new to Magenta, I recommend (if you decide to trade it) that you start out with nominal unit/lot sizes or paper trade it. Gauging what will follow the sequence end is anyone's guess, market forecasting really hinges on what the current sequence tells you about it's own ending. Place your stop loss above the absolute high/low event (mark) to the tune of whatever the spread is - usually 1-2 pips works for me. Thanks for your time. Enjoy watching this play out!
Long
by trendlab2
1
2H Trend Turn in USDCADAn exercise in forecasting is always like venturing out onto a thin limb, but this 2H sequence is so fascinating, I thought I'd go ahead and put this out there. I know my analysis looks confusing. Let me attempt a brief (hopefully not confusing) explanation... The various callout tags represent different processes playing out. Each process has it's own unique count. The red and blue triangles and squares are all the count points in the sequence. The red arrows are FCT's (Fractured Counter Trends) - these are important in counting... The main sequence here is called 'the cycle' - it's a repeating 2, 4, 6 count that usually skips FCT terminals (unless a 'count-through' signal appears) The bolded '6' tags are where the cycle ends. The red tags form the 'type' which is mirrored at the end of a trend by the 'antitype' (red/gray tags). In this sequence the type could be pointing to a 6/4 antitype to follow the cycle. From the current (rightmost 'event' (count point)) that indicates a 4-count followed by a new high (above 1.27020). If that happens, it should end the sequence/trend. A number of other things line up well with this scenario. Both prime sets (yellow and orange tags) hit 4 and 12 respectively at that point. Also at that point, well count a trending count of 10 (6+4 (see yellow prime set)) and an FCT count of 10 (6+2+2). If more or fewer than 4 points are created prior to the high the scenario is nullified. Although the initial prime set (yellow) allows for the trend to have ended, the second set (orange) and the type do not allow it. So I believe there's a good chance we'll see the high tonight or tomorrow. Gauging what will follow the high is anyone's guess (although subsequent sequences do tend to re-use values), market forecasting really hinges on what the current sequence tells you about it's own ending. Place your stop loss above the absolute high event (mark) to the tune of whatever the spread is - usually 1-2 pips works for me. Enjoy watching this play out, and have a good night!
Short
by trendlab2
1