I know what Crisstoff want to say, on the short term, a crash in stock market means, selling stock-->> buying US. The immediate actions is that US go UP due to liquidity shortage. But on the long term the reverse effect happen since investors looks for safe havens to their cash liquidity. Then the market become (will become) overflown with US liqudity. Theirs so much cash around that the US WILL go down. It's simply the law of offer and demand.

It might be simply be said but that's the way i understand it.

Here`s a free 10 page PDF from Robert Prechter about recent market events. He's thinks that it`s deflation that gonna happen.

prechter-outlook-profit-interview.pdf

Here's another pdf document from EWI wich is a good starter to learn Elliot Wave principle.

best-of-traders-classroom.pdf

Enjoy!

GreatYves,

Yes, exactly.

Long term movements in Forex are determined by economic fundamentals, short term movements are influenced by liquidity (money flow from one investment instrument to another), psychology (rumors, beliefs, expectations) and market movers' (banks, big investment funds) intention.

We, traders try to find out from all of filtered info that comes through from the sources listed above (via fundamental and technical analysis) where the price is going to go...

Regards,

Chrisstoff

Morning, Guys:

No EW Charts from me today. Give me an excuse to be more relaxed this morning.

Over the weekend Sat and Sun, we were overloaded with Charts – Daily and Weekly and even Charts for Dow, SP500, etc. comparing in crisscross all the changes that are taking place in our currency pairs. Hope readers did not end up with a headache.

And with Chrisstoff and GreatYves joining in the discussions, things have become livelier. Gives us further insight into factors to consider when we want to get involved in forex trading.

These charts will be relevant today.

So, what is the conclusion? What are you going to trade today? Buy, Sell, Step Aside and which currency pairs will you go for?

I believe GreatYves is clear-cut enough to go for EURUSD with his 1-hour analysis.

I stick to my trading plan and go LONG on GBPJPY, GBPUSD, EURUSD and USDJPY for the reasons I have given yesterday in my posting. At time of writing, have not placed my orders yet though I normally do so on the opening price. Today, I follow the trading rule BUY ON DIPS in an Uptrend and wait for further FR retracement before I act. And I shall be quick enough to lock in profits when they arise.

Have a good trading day. If there are any significant developments, shall keep readers updated.

Kenneth

I have the finger on the trigger for eurusd long, based on EW. Also looking for 4hr box trade on gbpjpy, will set orders at 21.00 EST. There is no EW involved on this box trade.

Was late and i was eager to set my long into eurusd without proper confirmation and you guessed it i got stop. So lesson learned. Wait for at least hourly trend to be into your direction prior taking the trade... My box trade is going very well..

Hi, Guys:

I was monitoring more on Nikkei , Hang Seng and our Malaysian stock markets the whole day and saw them plunging.

The Nikkei dropped 755 points and Hang Seng 328 points, both 3% down. And the China market dropped 5% or 176 points.

FTSE and DAX also fell in unison.

The reasons given for the fall in world markets was weak US Consumer Confidence.'

Fundamentally and Technically, it is likely that Dow will fall tonight in tandem with world markets.

On Sat: I wrote an article in this forum on the effects of a fall in world stock markets and world economies on their currencies.

And we also highlighted that the Weekly EW charts show (1) that the current uptrend is only a CORRECTIVE Uptrend and not a bull market. (2) that the signs are showing in both the Weekly and Daily charts that the stock markets are at the tailend of their uptrrend.

And the Weekly charts also showed the same story for EURUSD, EURJPY, GBPJPY and GBPUSD.

Imp;act on Currencies: The Euro went down against the US Dollar and so did the Pound against the Dollar, and the US Dollar went down against the Yen.

In my morning's posting, I intended to go long on GBPUSD, GBPJPY, EURUSD and GBPJPY against my own findings as I was playing a game based on the Theory of Statistical Odds and I waited for quotes to fall but because of what I saw in world equity markets, I refrained from entering the forex market. I was "saved" by the fact that I always look at the stock markets first, then only the forex market (not the other way round.)

When the forex markets close today and after I have updated the charts, we will be able to see how the Wave Strutctures have changed (if any).

Tomorrow's EW charts will be interesting.

Kenneth

Using your 1-hr analysis chart, in the Minuette time frame, it was a Buy on the EURUSD - and that was a correct interpretation.

However, based on the "Subminuette" time frame, it was a SELL signal with a Down trend.

In other words, if we analyze EW charts into such minor waves, one would normally play the bottom signal first and as it completes its wave, then you move on to the higher time frame.

Once the Subminuette wave completes its cycle, it will go into the Minuette, then the Buy goes into play.

Kenneth

You are right. All waves need to be on same side in order to take the trade. I took the risk and was ok with it. Now all exits at 4045. So i am long again for a low risk trade. Heavy storm here... Will chat later.

Here eur usd hourly update.

elwaveeurusd.bmp