EUR/USD: May Be Heading Below 1.04 Level
Investment Resources | Feb 01, 2017 11:49AM ET
According Elliot Wave Principle EUR/USD either reached the top of the wave 4 and it is currently at the beginning of the wave 5 which is supposed to take the currency pair bellow the level of 1.04 where the wave 5 is supposed to finish and complete the 5 waves impulse pattern.
It could be also possible the wave 4 has not been completed yet and the competition of the wave 4 take the currency pair little bit higher nevertheless this should not invalidate expected move down.
Alternatively the wave 4 has not been completed yet and the pair is in the wave B of the wave 4.
This doesn't change the fact the pair is currently heading down and it should reach at least 1.05 level nevertheless move below 1.04 is more likely according the Elliot.
It could be also possible the wave B has not been completed yet and the completion of the wave A take the currency pair little bit higher nevertheless this should not invalidate expected move down.
The second option is hypothetically more likely as the as the wave 4 is supposed to take more time to complete especially when the wave 2 didn't take too long.
In this case the pair is supposed to stay in range between 1.03 -1.08 for a about 3-6 weeks.
We have already sold EUR/USD at 1.0750 level and we are looking to take profit somewhere between 1.05-1.03 levels.
We never guide our trading decision based on technical analysis only nevertheless the fundamentals seems to be pointing at the same conclusion as our technical analysis: The pair is supposed to stay in range 1.08 – 1.03 in the next several weeks.
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