Sunday, December 16, 2012
Elliott wave analysis of EUR/USD and GBP/USD
We have finally seen a break out of the bearish channel confirming that we are in wave c of E of the long term running triangle, that has been building since late 2008. The break above the channel resistance-line means a rally higher towards at least 1.3491 and more likely closer to the 1.3778 - 1.3833 area before wave E terminates, but time will show. However, for now we should concentrate our focus towards the upside for move to 1.3347 as the next target on the way to 1.3491.
Short term we should not see a break below 1.3110 as that would delay the upside.
I'm still looking for a break above the B-triangle resistance-line at 1.6460 to be the first good indication, that a much higher rally is to be seen. Short term I will look for a break above 1.6175 and more importantly a break above 1.6310 as confirmation, that a serious test of 1.6460 is next. A break above 1.6470 should cause a massive rally higher towards at least 1.8898.
I have seen many call the downside as the think this is a wave 4 triangle and I have to admit it could be, but if my long term count is correct, and I think it is, then the odds for a break towards the upside is greater, than a break towards the downside, but again time will show how's right.