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EURUSD – Still in Search for a Top

Last week we expected the euro to reach its exhaustion point and form a top, which was not what happened.

While the euro has continued its upwards movement, the bigger picture of this action still looks overlapping and strained, which is a typical sign of corrections.

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.

6-Hour Main Count

– Invalidation Point: 1.3612
– Confirmation Point: 1.3809
– Upwards Target : 1.3798 – 1.3874
– Wave number: Submicro (5)
– Wave structure: Motive
– Wave pattern: Impulse or Ending Diagonal

6-Hour Alternate Count

– Invalidation Point: 1.3809
– Confirmation Point: 1.3523 – 1.3398
– Downwards Target : 1.3293 – 1.3273
– Wave number: Minuette (c)
– Wave structure: Motive
– Wave pattern: Impulse or Ending Diagonal

Elliott Wave chart analysis for the EURUSD for 13th December, 2013. Please click on the charts below to enlarge.

Main 6-Hour Wave Count

eurusdweekly

eurusdweekly

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 wave i unfolded as an impulse, and minute wave ii is most likely 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) is most likely unfolding as a double zigzag labeled subminuette waves w, x and y. So far it has retraced over 90% of minuette wave (a), fulfilling the requirement of a flat correction.

The final subminuette wave y unfolded as a zigzag labeled micro waves A, B and C.

Micro wave A unfolded as an impulse labeled submicro waves (1) through (5).

Micro wave B unfolded as a zigzag.

Micro wave C is unfolding as an impulse labeled submicro waves (1) through (5).

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.

Submicro wave (4) retraced 38.2% of submicro wave (3), so it’s most likely complete.

This count expects the euro to resume its upwards movement in submicro wave (5) to complete micro wave C, subminuette wave y, and the entire correction of minuette wave (b). This would be confirmed by movement above 1.3809.

This count is neither supported nor contradicted by the MACD momentum indicator — although the fact that momentum is trending with price indicates the continuation of the status quo, which is currently upwards. The lack of a reliable candlestick pattern also suggests continuation.

At 1.3798 submicro wave (5) would reach 100% the length of submicro wave (1), then at 1.3874 it would reach 61.8% the length of submicro wave (3).

This wave count is invalidated by movement below 1.3612 as submicro wave (4) may not enter the price territory of submicro wave (1).

Alternate 6-Hour Wave Count

eurusdweekly

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.

According to this count, the euro is now moving downwards in minuette wave (c), within which subminuette wave i may already be complete.

This count expects the euro to first finish the upwards correction of subminuette wave ii before resuming its downwards movement to complete the rest of the subdivisions within minuette wave (c) to complete minute wave ii. This would be initially confirmed by movement below 1.3523, with final confirmation below 1.3398.

At 1.3293 minute wave ii would retrace 50% of minute wave i, then at 1.3273 minuette wave (c) would reach 100% the length of minuette wave (a).

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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