Monday, October 5, 2015

Continuation Of Eurusd Bullish Correction. How probable?

It's been long that I haven't updated on this pair. The last analysis titled Eurusd Intraday Update was about how far price has reacted after the rise from 1.046.

Price from 1.046 is clearly engaging in a correction after a long term bearish move. The correction was expected to be a double zigzag pattern

The correction has already completed the first two legs of the prospective zigzag pattern. The last leg could take price to 1.23-1.25 resistive region.

The chart below shows the clear pattern forming within the last leg of the correction.

The last of the correction which ,on its own, should be a zigzag pattern is in the process of its second leg ( a probable triangle pattern). If this triangle pattern completes as indicated in the chart above, price would be expected to break above 1.1480 in a new bullish journey to 1.23-1.25 zone.

Triangle patterns are one of the corrective elliot wave patterns and they mostly signal the last drive of the prevailing trend (whether motive or corrective) before a bigger trend or a correction resumes.

An opportunity for a long trade will present itself if this triangle pattern is formed as forecast and price does not break below 1.10722 resistance level but rally above to break the triangle upside.

The bullish correction does not look ended unless price breaks below 1.10722 convincingly in high momentum.

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