Thursday, June 19, 2014
Elliott wave analysis of EUR/USD - Correction from 1.3503 continues
With the clear break above 1.3587, we finally got the clue needed to tell us, whether the correction from 1.3503 ended at 1.3587 or it only was part of wave c higher. We now know that it was part of wave c higher to 1.3690, where wave c will be equal in length to wave a. At 1.3690 wave (ii) will also have corrected 38.2% of wave (i). A correction of only 38.2% in wave two is a rather small correction and indicates underlying strength in this cross.
That said, we have to remember, that we don't yet have any knowledge, where wave (ii) will end. All we can do is look at the facts and try to access the possibilities and at this point they favour, that wave (ii) terminates near 1.3690.
Short term I'm looking for red wave iii to end near 1.3644 and call for a small flat red wave iv before the next minor rally higher towards 1.3683 to end red wave v and red wave (iii) and then another flat correction 1.3618 before the final rally higher towards 1.3690 to end red wave (v).
Once wave (ii) is over near 1.3690 I expect a new powerful decline towards 1.3200 and possibly even lower.
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