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EURUSD 17th December, 2013

Not much has taken place with the euro today. It moved in a sideways, overlapping manner and kept away from all of our target, confirmation and invalidation points.

The most recent movement actually opened the door for a few more possibilities. However, since it would be too much to cover all of them in one analysis, we’ll focus as usual on the two most likely counts while ensuring that our invalidation and confirmation points accommodate the other possibilities.

We’re updating our counts to reflect the most recent price action and to present tighter targets and invalidation points. And as usual we’ll use each count’s invalidation point as confirmation of the other count.

Hourly Main Count

– Invalidation Point: 1.3722
– Confirmation Point: 1.3809
– Upwards Target : 1.3808 – 1.3861
– Wave number: Nano iii
– Wave structure: Motive
– Wave pattern: Impulse

Hourly Alternate Count

– Invalidation Point: 1.3809
– Confirmation Point: 1.3708
– Downwards Target : 1.3646 – 1.3545
– Wave number: Subminuette iii
– Wave structure: Motive
– Wave pattern: Impulse

Elliott Wave chart analysis for the EURUSD for 17th December, 2013. Please click on the charts below to enlarge.

Main Daily Wave Count

eurusd-daily

eurusd-daily

The bigger picture sees the euro within primary wave B to the upside, and within that in intermediate wave (C), and within that in minor wave 3.

Within minor wave 3, minute waves i unfolded as an impulse labeled minuette waves (i) through (v), and minute wave ii is unfolding as a flat correction labeled minuette waves (a), (b) and (c).

Minuette wave (a) unfolded as a zigzag labeled subminuette waves a, b and c.

Minuette wave (b) has been unfolding most likely as a double zigzag labeled subminuette waves w, x and y. It has retraced well over 90% of minuette wave (a), fulfilling the requirement of a flat correction.

This count expects that minuette wave (b) is either complete or near completion (as explained in the hourly counts), to be followed by a continuation of downwards movement in minuette wave (c) to complete minute wave ii. This will be initially confirmed by movement below 1.3523, with final confirmation below 1.3398.

The MACD indicator shows a stable momentum flow that trends regularly with price, with a slight bullish bias.

On the other hand, a number of conflicting candlestick patterns indicates a period of indecision, although most of the patterns shown have a strong bearish disposition, including a “bearish engulfing pattern” and a “three outside down” pattern. The exception here is the “inverted hammer” that formed today, which is usually a bullish sign.

At 1.3293 minute wave ii would retrace 50% of minute wave i, then at 1.3165 it would retrace 61.8% of its length.

This wave count is invalidated by movement below 1.2754 as minute wave ii may not move beyond the start of minute wave i. No invalidation point can yet by placed on the upside as minute wave ii may be an expanded flat, within which minuette wave (b) can make a new high above that of minute wave i.

Main Hourly Wave Count

eurusd-h1

eurusd-h1MAC

This count sees that the final micro wave C within subminuette wave y is unfolding as an impulse labeled submicro waves (1) though (5).

Submicro wave (1) formed an impulse.

Submicro wave (2) formed a running flat.

Submicro wave (3) formed a series of extensions, the first labeled miniscule waves 1 through 5, then miniscule wave 3 extended into nano waves i through v, then nano wave iii extended into subnano waves (i) through (v).

Submicro wave (4) formed a double zigzag labeled miniscule waves W, X and Y.

Submicro wave (5) may be unfolding as an ending diagonal. But as it’s too early to tell, we’ll focus on the more natural form which assumes that it’s unfolding as an impulse.

Within it, miniscule waves 1 formed an impulse, and miniscule wave 2 formed a zigzag labeled nano waves a, b and c.

Miniscule wave 3 is most likely forming an extension, within which nano wave i has unfolded as an expanding leading diagonal labaled subnano waves (i) through (v).

Nano wave ii formed a zigzag labeled subnano waves (a), (b) and (c). Nano wave (ii) retraced well over 78.6% of nano wave (i), so it’s most likely complete.

Nano wave iii seems to be forming another extension, within which subnano wave (i) may be complete.

Subnano wave (ii) might be complete as a very shallow correction, which would mean that price should immediately continue upwards. However, it’s more like that the correction of subnano wave (ii) still has more to go towards the downside.

This count expects the euro first to move downwards to complete subnano wave (ii), possibly reaching between 1.3754 to 1.3742, before it continues moving upwards to complete the rest of the subdivisions within nano wave iii. This will be confirmed by movement above 1.3809.

This count is neither augmented nor contradicted by the MACD indicator, as momentum seems to be regularly fluctuating with price. The lack of a reliable candlestick pattern is another indication that both counts have virtually equal probabilities.

At 1.3808 nano wave iii would reach 100% the length of nano wave i, then at 1.3861 it would reach 161.8% of its length.

This wave count is invalidated by movement below 1.3722 as subnano wave (ii) may not move below the start of subnano wave (i).

Alternate Hourly Wave Count

eurusd-h1

This alternate count sees that minuette wave (b) is already complete, with its final micro wave C of subminuette wave y having subdivided into 5 complete waves labeled submicro waves (1) through (5), and the euro is now moving downwards in minuette wave (c).

Within it, subminuette wave i unfolded as an expanding leading diagonal labeled micro waves 1 through 5, each subdividing into a zigzag labaled submicro waves (A), (B) and (C).

Subminuette wave ii could be unfolding as a double zigzag labeled micro waves W, X and Y.

Within micro wave Y, submicro wave (A) unfolded as an impulse and is probably complete.

Submicro wave (B) might be complete as a very shallow correction. However, it’s more like that the correction of submicro wave (B) still has more to go towards the downside.

This count expects the euro first to move downwards to complete submicro wave (B), then push upwards to around 1.3790 to complete submicro wave (C), micro wave Y and the entire correction of subminuette wave ii, before reversing towards the downside to begin subminuette wave iii. This will be confirmed by movement below 1.3708.

Since subminuette wave ii is still incomplete, we’ll calculate our targets based on its maximum allowable length, and we’ll update these targets once we’ve confirmed that subminuette wave ii is complete and that subminuette wave iii has indeed begun unfolding.

At 1.3646 subminuette wave iii would reach 161.8% the length of subminuette wave i, then at 1.3545 it would reach 261.8% of its length.

This wave count is invalidated by movement above 1.3809 as subminuette wave ii may not move beyond the start of subminuette wave i.

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