The Elliott Wave picture for the EURUSD indicates there is a higher probability bounce coming. The trend is down, so for those traders who missed out on this move lower will get a shot to short from higher levels.
Under the preferred interpretation, it appears we are finalizing the 5th wave lower from the October 15 high.
3 different wave relationships show up near 1.0900-1.0910 with some more down near 1.0860.
-circle wave 5 = circle wave 1 = 1.0910 -circle wave 5 = .382 * circle wave 1 through 3 = 1.0907
Additionally, one alternate count I'm watching is that we are finalizing circle wave 3. Circle wave 3 = 2.618 * circle 1 at 1.0903. This alternate would suggest a bounce to 1.10-1.11.
From a bearish perspective, we think these red circle waves make up wave 1 at a larger degree. If that is the case, then we should see wave 2 be a partial retracement higher (probably towards 1.11-1.13. We will not look to trade this higher because the trend is firmly planted to the downside, but those who are short may want to manage risk accordingly.
Another alternative we're watching is that this 5 wave move lower from October 15 is the matching wave to the late Aug 2015 sell off. If that pattern plays out, there could be a much larger rally that begins from slightly lower levels (between 1.08-1.09).
Bottom line, a bounce higher to 1.10-1.13 is likely. From there, we'll see how the pattern is developing to determine pivot levels. Below 1.0800 would increase the chance of a much deeper sell off to below 1.05.
he described a range of 1.11-1.13 being likely he didnt say 1.13 is likely that would be the extreme
Lanmar
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"Bottom line, a bounce higher to 1.10-1.13 is likely." This is the same thing as saying a bounce to 1.1299 is likely, which of course from a probability standpoint that is false.
Lanmar
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Certainly possible of course.
tupaitrader
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great setup
chessnut
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I think this could be a nice primary count
chessnut
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and with interest rate hike off the table at this FOMC meeting you could say that this wave is based on little other than fear of a hike. The stronger the USD the lower the probability of a hike... seems like a paradox to me.