EURUSD – 1st September, 2014 – Monthly

The euro continued moving, even more strongly, towards the downside. It has already broke through the 10-month low it had established in November 2013, and is quickly coming down to test the lower bottom of September 2013.

Our previous assumption was that the euro was moving in the first wave within a third-wave extension. But given the length, strength and consistency of its decline, it makes more sense to assume that this third wave is quite mature.

We’re updating our count to reflect the most recent price action and to present tighter targets and invalidation points.

Monthly Main Count
– Invalidation Point: 1.3995
– Confirmation Point: –
– Downwards Target : 1.2789 – 1.2201
– Wave number: Primary E
– Wave structure: Corrective
– Wave pattern: Zigzag, or Combination

Elliott Wave monthly chart analysis for the EURUSD for 1st September 2014. Please click on the charts below to enlarge.

Main Monthly Wave Count

The bigger picture sees the euro moving sideways in cycle wave x, which is forming a contracting triangle labeled primary waves A through E.

Within it, primary waves A, B, C and D are complete.

Primary wave D unfolded as a double zigzag labeled intermediate waves (W), (X) and (Y), each subdividing as a zigzag labeled minor waves A, B and C.

Within intermediate wave (Y), minor wave A formed an impulse labeled minute waves i through v.

Minor wave B retraced 50% of minor wave A.

Minor wave C formed an ending diagonal labeled minute waves i through v.

Now, primary wave E is most likely unfolding as a zigzag labeled intermediate waves (A), (B) and (C).

Intermediate wave (A) is unfolding as an impulse labeled minor waves 1 through 5.

Within it, minor wave 1 formed an impulse.

Minor wave 2 retraced 38.2% of minor wave 1.

Minor wave 3 is unfolding as an impulse, and has already exceeded 100% the length of minor wave 1.

This count expects the euro soon to complete minor wave 3, possibly around the 1.3100 support level. Afterwards, it expects it to move sideways to upwards to minor wave 4, then downwards in minor wave 5 to complete intermediate wave (A), then upwards again in intermediate wave (B), and finally downwards in intermediate wave (C) to complete primary wave E, and therefore cycle wave x.

The MACD indicator shows a steadily-increasing downwards momentum.

In terms of candlestick analysis, no clear pattern appears at this point.

At 1.2789 primary wave E would retrace 61.8% of primary wave D, then at 1.2201 it would retrace 61.8% of primary wave C.

This wave count is invalidated by movement above 1.3995 as intermediate wave (B) may not move beyond the start of intermediate wave (A). It’s also invalidated by movement below 1.2043 as primary wave E may not move beyond the start of primary wave D.

2 thoughts on “EURUSD – 1st September, 2014 – Monthly”

  1. Hi Tamer , If the downside target is E ( at above 1.2043) , do you expect the EURUSD to reverse and rally impulsively after that ? Perhaps the E should be at 1.3995 , where your D is – this means (a) there will be no black (A) coming soon . (b) the EURUSD can fall below 1.2043 without invalidating your count .. The present fall from 1.3995 is impulsive instead of corrective (A)(B)(C) . . What do you think ? Regards , Raymond

    1. Hi Raymond,

      That’s a great analysis. However, let me clarify why I prefer the current count than the one you mentioned (which we had covered in a previous monthly analysis here:…

      1) Why I don’t think the triangle is complete at 1.3995:

      “The major drawback of this count is that primary wave B is taking too long to unfold compared to primary wave A. Technically, this doesn’t break any rules, but seeing that a correction is taking more than 20 times the duration of previous motive wave of the same degree puts serious suspicion on this possibility.” (Copied from the above link.)

      2) Why the fall from 1.3995 is impulsive:

      This is because it’s only wave A, which itself is an impulse. As the pattern continues over the coming months, waves B and C should make the overall structure (i.e. the wave at “one larger degree”) corrective.


      That said, I’m not ruling out your suggestion. In fact, it seems to be the count favored by many of the EW analysts I keep an eye on, and it’s one that I’m already keeping track of. I just consider it a lower-probability count at this point. Also, we’re still months (possibly years) away from having to worry about it, since both counts agree on the general direction at this point 🙂

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