Eurusd Intraday Update

Over the week, price has reached our forecast target at 1.6-1.7 and immediately reacted there as it dipped in what looks like a correction. 

The alternate medium-term triangle projection did not hold and we can still stay with our original forecast of a {WXY} double zigzag correction of the bearish move that ended at 1.045 in March.

Follow the Gold Market

In the early stage of this millennium, we have seen Gold  very valuable commodity as it made a record high at $1920 per ounce. It was a clear impulse wave ( a strong trend).

According to the Elliot wave theory, price corrects in 3-waves after trending in 5-waves.
The sell off which started in 2011 after the record high should be a 3-wave correction. There are a number of corrective patterns as described by Elliot Wave Principle. One of these patterns is the Zigzag pattern.

EurUsd New Outlook

On 4th August, I posted a forecast titled Eurusd about to complete a triangle on Eurusd based on elliot wave analysis and followed the intraday moves on the Eurusd Intraday Analysis page.

The conclusive paragraphs of this analysis are quoted below.

"The [X] leg of the prospective double zigzag is about to complete a triangle (an elliot wave corrective pattern) and a break above the B-D triangle line will validate a move to advance Eurusd to 1.16-1.18.

Price is expected to complete the last leg of the triangle which should end at 1.081. A break below this level will invalidate the entire forecast."

EurAud Could be Exhausted Upside: Imminent Sell Off.

The price movement from 1.3655 in April 2015 after the completion of a diagonal pattern highlighted how important elliot wave patterns could be. The bullish move should never be mistaken for an impulse wave.

The fact that component waves are 3-waves shows that the entire movement is not impulse not to talk of how the entire movement was perfectly placed in a channel (which is not common to Impulse waves).

The pattern was forecast to be a triple zigzag (often formed within a channel) in the Intra-day analysis of Euraud.

Elliot wave stated clearly that after a corrective pattern, a motive wave should follow and if this pattern will hold, we might see price falling in months to come.

Meanwhile, price could go a bit higher but should be contained below 1.5700-50 before the sell off.

We are prepared to follow through: you can join the daily updated Intra day analysis of Euraud.

What Drive The Diagonals?

The diagonal pattern is one of the 2 motive waves discussed by the elliot wave theory. The diagonal is so often followed by a fast and high momentum breakout that it has become its 'after-formation' characteristic.

But, what drive the diagonals to behave so?

The close of trades of UsdJpy and GbpJpy last week showed clearly how price responds after a diagonal pattern has formed.

In the last post on GbpJpy titled GbpJpy: When Will The Bears take Over , I quoted thus:

"If price is contained below 195.755 and breaks 193.34, price could start a big fall to 190.863 (in the short term) and 173.553 as the final 'after-diagonal' price reaction target."

GbpJpy: When Will The Bears Take Over?

The weekly chart above shows the sell off from 252.167 to 118.161 in a supercycle bearish impulsive journey. After such an impulse wave, a correction would be expected. The correction started from 118.161 in a zigzag pattern.

Nzdyen Last Sell-off Leg Imminent?

The chart above shows that price is in a correction stage, wave 4 ( a probable zigzag) of an impulse cycle wave which started at 44.099 in 2009 and which is suppose to be the final advance (wave 5), of the larger term super cycle wave or part of it ( if cycle wave 5 will be extended).

Gbpusd: The Clear Picture.

In the LAST UPDATE on this currency pair, I wrote about a long term bearish bias. I also mentioned that in the hourly charts we might see some bullish move (especially if the rising trendline is not broken downside) before the bearish trend resumes.

A double zigzag correction to 1.65 was expected though the 'B' wave pattern of the zigzag was not so clear.

The 'B' wave now seem to form a triangle.

Price is expected to break above 1.571 to confirm the triangle formation.

In order for the triangle pattern to hold, price should not break below the ACE support line of the triangle.

Triangle patterns , according to elliot wave theory usually precede the end of a trend or correction. The formation of this triangle could mean that the correction upside is not over yet.

The Long Journey of Euraud

The long term cycle impulse wave from 2.1144 in 2008 to 1.1514 in 2012 is expected to be followed by a 3-wave correction of the same degree ( according to the wave principle).


The first leg of this correction ended in a 5-wave impulse primary wave and it's also expected to correct in 3-waves of the same degree which I once forecast to end at 1.3250 before the diagonal that formed at 1.36175.


This diagonal prompted me to believe that the primary wave correction was over.

From 1,36175, price was expected  to complete the last leg of the cycle wave correction in a move that should break above i.58619. The rally from 1.36175 was rather a correction ( double zigzag) and this changed my view that the primary corrective wave might not be over yet and I favour price reacting to the correction in a new impulse wave down to 1.265.

How Longer Will The Bull Rule UsdJpy?

Usdjpy broke 13 year high with a long term impulse primary wave which started from 75.045 in late 2011. The primary impulse is presently at an advance stage which could probably extend to 135-136.

I believed the dip from 126 would be the beginning of a primary correction in what was expected to be a motive wave but a double zigzag corrective pattern was formed instead which suggested to me that the primary bullish wave should still continue and the next long term price levels to watch out for are 135-136 (2002 high was at 135.798).

Follow the intraday analysis here

Eurusd About To Complete A Triangle

Amidst uncertainty concerning the greek bailout, the Euro which is perhaps destined for more dip does not yet look set for it. The rally from 1.045 can be said to be corrective. The questions are: what corrective pattern and when will it end to give way for the bears to take over in a move expected to break below the 1.045 mark.

I have for a long time forecast a double zigzag correction to 1.78-85 price level and price has not fulfilled it neither has it invalidated it.