The EURO has rallied more than 2% since the last Fed rate hike. It rallied above our Fibonacci pivots at 1.071 to 1.0778. Will the rally continue or the bears will take over?. We look to answer these questions based on 17 March EURUSD daily Elliott wave analysis.
17 March, AtoZForex – In the last update before the last FOMC, we were on the back on a two consecutive perfect forecast in a week using Elliott wave theory. Elliott wave theory, as it’s been proven by traders for many decades, is an effective market forecasting tool. It’s so fascinating, not only for its forecasting ability but the fact that it can be used as a simple trading system. By recognizing Elliott wave patterns bounded by specific mathematical Fibonacci ratios, the trading world is yours to take.
The chart below was used before the FOMC rate vote announcement.
We had a bearish bias before the event and expected price to be contained below 1.068 correction if our last analysis will hold. We put it exactly this way:
There could be a pullback before drop continues. 1.067-1.0685 are levels of retracement to watch out for. A strong rally above this level will negate our view and send price on a strong rally above 1.0715 peak. A strong dip below 1.04 will be seen if the bearish resurgence resumes.
The rate hike pushed price above 1.0685 and thereafter above 1.0715 peak. Elliott wave teaches a lot of patience to wait for price to come to our level. If price key in, we connect and look for opportunities; if it doesn’t , we disconnect and reanalyze. It’s as simple as that. No complications. Elliott wave leads, price follows and we follow – that’s the sequence. Sometimes price doesn’t play the out our expectation; nothing is perfect, even Elliott wave theory!.
When price violates our expectations, we simply look for alternatives based on the wave theory and follow same sequence. The chart below shows the new expectation.
The chart above shows that the rally from 1.0490 looks corrective. the emerging pattern is a double zigzag. Wave Y is about completing and will be confirmed by a bearish breakout. Price is presently at a strong mathematical reversal zone. The double zigzag should complete and be confirmed below 1.08 or slightly above it. The rally will persist if price breaks above 1.08 in high momentum. The chart below shows the intraday bearish opportunity.
17 March EURUSD daily Elliott wave analysis: intraday bearish?
The chart below shows what could be the last leg of the double zigzag.
A good break below 1.0747 should be enough to confirm the bearish resurgence. Price could dive to 1.06 and below if the bearish trend will resume. The double zigzag will be violated above 1.08.
Do you have other views in contrast to the ones listed or you want to compliment them further? let’s know by your comment below.
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