Monday, May 23, 2011

Countertrend Rally X

Price went lower as expected, we are now in wave (Y), but this could possibly be a lower degree, meaning that we are now only in Y of (W). I'm expecting this latest rally, wave X, not to go very high or last very long.

Geplaatst door op
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2 comments:

  1. AnonymousMay 23, 2011 at 8:41 PM

    Hi Jeremy!

    I can only congratulate you on seeing the top at 1.4930. Your analysis was just great!
    Unlike you, I've got hanged into the idea that a top shall also present a divergence between price and RSI on the daily chart. One more lesson to learn that the divergence is not a must.

    Wish you all the great!

    Catalin

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  2. Jeremy DemunterMay 23, 2011 at 11:09 PM

    Hi Catalin,

    Thanks for your comment! To be honest, i thought price would go through 1.50, but i guess there were too many bulls, so no one left to push price through. Besides, EW told us that we were close to a top, the exact count was only clear on may 5th when price dropped hard. In my experience, all indicators are dangerous as they give way too many false signals. Also they are lagging and like you say sometimes they show divergence sometimes they don't. The only time i will watch for divergence is when price is in a 5th wave of an impulsive wave. Anyway, forex is a game where we're always learning, but the lessons can be expensive at times. I guess we just have to stay in the game long enough to make back the money we lost learning and make a profit eventually.

    Best of luck,
    Jeremy

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