The euro formed a double-bottom on severely bullish momentum divergence. Not only does this boost my confidence in the main count, but it also maintains its targets while providing an even closer confirmation point.
Cable traded on up in a choppy manner, in line with the idea that the downtrend remains in play.[View Wave Counts & Charts…]
Last week saw a modest, but consistent, decline in euro’s prices, contrary to my expectation of a bottom being prepared.
Nonetheless, this current decline has so far consumed nearly 3 times the duration of the preceding advance, only to retrace 80% of its gains.
Therefore, and with the risk of repeating my previous failure, I still find it most reasonable to treat this decline as a temporary correction.
Whether the corrective bounce from the 1.2014 is taking the form of a triangle correction or a different corrective pattern, remains to be seen. The bottom line remains that the larger degree trend is down. [View Wave Counts & Charts…]
As expected the euro moved toward the downside, reached our first target, and exceeded it by 2 pips.
This downward correction made up in time for its lack of depth, and I find it very prudent and reasonable to prepare for the possibility of its being complete.
Cable fell short of our second target by 9 pips before reversing gears. The working assumption is that any bounce should prove corrective, paving the way for further decline. [View Wave Counts & Charts…]
As expected the euro moved toward the downside and came only 3 pips short of reaching our first target.
It seems that the first two phases of this correction are now complete, and only the last one remains.
The bounce from the 1.2079 swing low is in line with the main outlook. The main hourly count suggests that lower lows should lie ahead. [View Wave Counts & Charts…]
As expected the euro moved toward the upside to reach and exceed both of our hourly targets. What wasn’t expected was the speed and aggressiveness of this rally, which pulled prices up almost to the first target of the daily count.
At such an early stage of development, I’m reluctant to propose a labeling for the hourly action. That said, based on rough estimates, I find it more likely that this new rally is part of a larger leading diagonal.
As expected the euro moved toward the downside, reached our first target, came only 1 pip short of reaching our second target, and then started to rally slowly but very consistently.