From the weekly chart above, Elliott wave theory enabled us to have a good technical understanding of what price has been doing since 2011. A 5-wave decline is usually followed by a 3-wave rally (classic elliott wave theory).
We identified the wave (b) of the prospective correction in an article published on 10th February, (click to read again). It was a triangle pattern and price rallied well to our targets.
Price has been in a dip from 1.1330 since March and we wonder if it will continue or price will rally.
The long term correction upside may not be over yet and we are just looking for a good reason to back up our reasoning.
The chart above showed that the recent dip could be the wave 2 of an expected motive wave C .and price could resume higher in what could be another round of rally.
The wave (c) is also an ending diagonal- a terminating pattern. Seems we have good proofs, Elliott wave theory wise, to believe that a rally is imminent.
The chart below shows the terminating end of the diagonal more clearly.
There could be a very good opportunity for the bulls to resume possession and drive price as high 1.0929 or above.
For this diagonal to hold, price will be expected to be held above 1.06417, a break below could hamper the diagonal pattern.
A proper break above 1.0757 should be good enough to validate the pattern.
I hope this analysis helps somebody. Please drop you comments and help share this post.
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Your article is always helpful.....
ReplyDeleteThank you Ashif
ReplyDelete