JWagnerFXTrader
Long

EUR Leading Diagonal Pattern Opens the Door for Longs

FX:EURUSD   Euro Fx/U.S. Dollar
Last night, we posted about the potential for a leading diagonal on the EURUSD             (see the notes at the bottom of “EUR Analysis Prior to Greece Referendum Vote”). The pair has continued to play that tune which implies:

• A tradable low is in place at 1.0915 which coincides with scenario #2 in the “EUR Analysis Prior to Greece Referendum Vote” (see green notes on the original chart)
• The 1.0915 ended 4 degrees of trend and likely kicks off a green circle ‘c’ wave higher which subdivides into 5 waves
• Look for a 50-78% retracement on the diagonal to time a long entry (1.0960-1.1020)
• Target 1.1250 and 1.1470
• If prices break above 1.1125 BEFORE hitting the retracement zone of 1.0960-1.1020, then consider a breakout long trade

A print at 1.0914 means this analysis is incorrect so we have the opportunity for a good risk to reward ratio long trade.

Also, SSI             continues to be weighed towards sellers at -1.69. Sentiment can be used as a contrarian signal which suggests prices may rise. These traders who are short become future supply of buyers as they are already committed to their position.

Additionally, with the analysis posted yesterday on the USDCAD             ( bullish ), this may open the door to consider long EURCAD             . EURJPY             may have some bullish juice in it too. I’ll post those if any clean EW counts or RR ratio trades can be identified.

Though this post is written to the tune of the higher probability leading diagonal scenario. Other scenarios do exist. I have listed the top 4 as I see them.

For those Elliotticians, what other scenarios are you considering on EURUSD?
Prices entered into the potential reversal zone. Today's low at 1.1000 is a potential pivot spot higher. A move above 1.1030 builds the case for the pivot. Otherwise, let's see what happens at 1.0970.

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tupaitrader JWagnerFXTrader
a year ago
great!!
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With the grey resistance channel out of the way, now you have the previous high of 1.1068

EURUSD is behaving like a secondary low is in place at today's low.

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docwesley90 JWagnerFXTrader
a year ago
Curious, what do you mean by leading diagonal? Thanks.
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UPDATE: Prices paused at the equal wave relationship. A break above 1.1220 would make an extension higher more probable. A trader could consider adding to the long position on a break above 1.1220. Extension target is 1.1328.

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IvanLabrie TOP JWagnerFXTrader
a year ago
Yes, I'm thinking this is an ABC and a potential triangle E wave completion in the daily.
With bearish gap down implications during the weekend.
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IvanLabrie TOP JWagnerFXTrader
a year ago
I think gap down open on Sunday.
Now if this is a new impulsive rally, it will be a great buy.
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JWagnerFXTrader PRO IvanLabrie
a year ago
Well, if this digs too deep on Sunday...it will hamper the rally. There is a still a pattern that would be bullish from a deep gap down, but those bullish odds take a hit on a big gap down. Essentially, today's afternoon sell off cut fairly deep and it took place at the equal wave measurement. Around 1.1070 is where today's sell-off matches the length of yesterday's sell off.

I'm leaning towards a gap higher that follows through and keeps running for a day. That is purely speculating...not a recommendation or advice.
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IvanLabrie TOP JWagnerFXTrader
a year ago
Maybe.
I will wait on the sidelines.
We will know more after the news are out.
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Pathfinder PRO JWagnerFXTrader
a year ago
I'm totally new at this but thought I would take a shot and chime in. Would love your thoughts on the counts below. The latest pattern looks to me like an a-b-c correction (might have the labels wrong) that is part of the e wave of a larger triangle. The correction retracement should fall around 1.1101 (.5 Fibonacci) or 1.1075 (.618 Fibonacci) - which is close to where the previous wave iv terminated. Once that corrective wave low is obtained, we should see it turn and continue the advance higher. Would love to have your take on it.

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FullTimeTrader
a year ago
Nice! after the leading diagonal we had a perfect zigzag to enter al the 0.61 fib retracement
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JWagnerFXTrader PRO FullTimeTrader
a year ago
It was a clean retracement for sure.

What do you think FullTimeProTrader...gap up on wave 3 of 3? Or, just a simple A-B-C higher from July 7?
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FullTimeTrader JWagnerFXTrader
a year ago
I expect a gap up to complete an A-B-C based on the idea we are within a triangle
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IvanLabrie TOP FullTimeTrader
a year ago
3 of C can gap up I guess. C might be like a beam.
Either way, it'll be clear on Sunday.

I posted an NZDUSD chart, would like your input guys:

NZDUSD: Very close to a market bottom
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rick.alter.35 FullTimeTrader
a year ago
nice but the triangle has ace trendline upside down tho
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rick.alter.35
a year ago
yea that leadingdiag may just spawn a c'wave then we reverse for abc down so we're in a triangle most likely..what you think jwag?!
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JWagnerFXTrader PRO rick.alter.35
a year ago
Yes, the July 7-10 move is clearly an equal wave zig zag. The x triangle is possible. 1.0915 should hold so one could consider a long the closer we approach 1.0915 and target 1.12.
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TradePeriod
a year ago
On point! Nice charting!
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Rooshan123
a year ago
can we take buy entry now?
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JWagnerFXTrader PRO Rooshan123
a year ago
Well, that is up to you. The x-wave triangle interpretation suggests and eventual move above 1.14. However, we may still only be in the 'd' leg of the triangle, so more sloshing around is called for under that interpretation. Therefore, for the time being, one could look for entries in the 1.095-1.1025 zone and target 1.12.
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IvanLabrie TOP JWagnerFXTrader
a year ago
Or just trade other less sluggish pairs.
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JWagnerFXTrader PRO IvanLabrie
a year ago
Indeed! It boils down to risk to reward ratios...where do you get the better opportunities. Right now, it seems xxxJPY has been the broad based mover for the past couple days.
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IvanLabrie TOP JWagnerFXTrader
a year ago
Yes, looking to go long there.
I'm long NZDUSD for a 4h C wave up.
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