Ever since its long-term low at 1.0462, which was formed nearly a year and a half ago, the euro has been moving in a clearly converging range, despite the rising momentum on the weekly chart.
The daily chart has witnessed more lively action, at least in comparison to the weekly, but price is still all over the place and the market doesn’t seem to have a clear direction just yet.
This week we offer two daily counts, both of which expect this consolidation to be at an end. On one hand, the main count anticipates a couple more weeks before the triangle is fully complete, since its final wave is quite short in time in relation to its other waves.
We’re updating our counts to reflect the most recent price action and to present tighter targets and invalidation points.
Weekly Main Count
– Invalidation Point: 1.1616 – 1.0913
– Confirmation Point: 1.1200
– Upwards Target: 1.1348 – 1.1587
– Wave number: Minor E
– Wave structure: Corrective
– Wave pattern: Double Zigzag
Weekly Alternate Count
– Invalidation Point: 1.1616
– Confirmation Point: 1.0913
– Downwards Target: 0.9118 – 0.7769
– Wave number: Intermediate (C)
– Wave structure: Motive
– Wave pattern: Impulse or Ending Diagonal
Please click on the charts below to enlarge.
The bigger picture sees that the euro is moving towards the downside in teal wave x, which is forming a double zigzag labeled maroon waves W, X and Y.
Maroon wave Y is forming a zigzag labeled black waves (A), (B) and (C).
Black wave (A) formed an impulse labeled blue waves 1 through 5.
Black wave (B) is forming a contracting triangle labeled blue waves A through E.
Main Weekly Wave Count
Within black wave (B), blue wave D formed a zigzag labeled pink waves a, b and c, retracing a little over 61.8% of blue wave C and reaching a little than 61.8% the length of blue wave B.
Blue wave E is forming a double zigzag labeled pink waves w, x and y.
Within it, pink wave w formed a zigzag labeled green waves (a), (b) and (c). It’s either complete or very near completion.
This count expects the euro first to move sideways or downwards in pink wave x before reversing towards the upside in pink wave y to complete blue wave E of black wave (B). This will be supported by movement above 1.1200.
At 1.1348 blue wave E would retrace 61.8% of blue wave D, then at 1.1587 it would reach 61.8% the length of blue wave C.
This wave count is invalidated by movement above 1.1616 as blue wave E of a contracting triangle may not move beyond the start of blue wave D. It’s also invalidated by movement below 1.0913 as pink wave x of a double zigzag may not move beyond the start of pink wave w.
Alternate Weekly Wave Count
This alternate count sees that blue wave E is already complete or very near completion, having formed a simple and relatively short zigzag labeled pink waves a, b and c.
Within it, pink wave c almost reached 100% the length of pink wave a. It’s either complete or very near completion.
This count expects the euro finally to resume moving towards the downside in black wave (C) to complete maroon wave Y of teal wave x. This will be largely confirmed by movement below 1.0913.
At 0.9118 black wave (C) would reach 61.8% the length of black wave (A), then at 0.7769 it would reach 100% of its length.
This wave count is invalidated by movement above 1.1616 as blue wave E of a contracting triangle may not move beyond the start of blue wave D. Once price reaches our confirmation point, we may lower the invalidation point to the end of black wave (B), which currently stands at 1.1198.