As we move further along the holiday, the market continues its slow, uneventful sideways movement. It’s quite possible that we’ll begin our analyses with this statement for another couple of days.
Our counts remain pretty much the same, since little has changed in the market. We still would like to see a break beyond our confirmation point before we can have full confidence in our count. But so far all the indication strongly suggest that everything is unfolding exactly as expected.
We’re updating our counts to reflect the most recent price action and to present tighter targets and invalidation points.
By moving below 1.0426, EURUSD would be expected to find short-term support between 1.0359 and 1.0292. The market should find strong resistance around 1.0499, but even if it breaks it, it should not move above 1.0670.
Hourly Main Count
– Invalidation Point: 1.0499
– Confirmation Point: 1.0426
– Downwards Target: 1.0359 – 1.0292
– Wave number: Micro 3
– Wave structure: Motive
– Wave pattern: Impulse
Elliott Wave chart analysis for the EURUSD for 26th December, 2016. Please click on the charts below to enlarge.
Main Daily Wave Count
The bigger picture sees that black wave (C) is likely forming an impulse labeled blue waves 1 through 5.
Within it, blue wave 2 formed a double combination labeled pink waves w, x and y, retracing nearly 50% of blue wave 1.
Blue wave 3 is forming an impulse labeled pink waves i through v.
Within it, pink wave iii is forming an extension labeled green waves (i) through (v).
This count expects the euro to continue moving towards the downside in pink wave iii.
At 1.0105 pink wave iii would reach 161.8% the length of pink wave i, then at 0.9756 it would reach 261.8% of its length.
This wave count is invalidated by movement above 1.0670 as green wave (ii) may not move beyond the start of green wave (i).
Main Hourly Wave Count
This main count sees that green wave (iii) is forming an impulse labeled orange wave i of green wave (iii).
Within it, orange wave i is likely forming an impulse labeled violet waves 1 through 5.
Within it, violet wave 2 formed a double combination labeled aqua waves (W), (X) and (Y), retracing about 50% of violet wave 1.
This count expects the euro to move towards the downside in violet wave 3. This will be somewhat confirmed by movement below 1.0426.
At 1.0359 violet wave 3 would reach 100% the length of violet wave 1, then at 1.0292 it would reach 161.8% of its length.
Note that this hourly labeling is very tentative and preliminary. It’s quite possible that green wave (ii) itself is still unfolding as a prolonged, even more complex correction.
This wave count is invalidated by movement above 1.0670 as green wave (ii) may not move beyond the start of green wave (i). Once the market moves below 1.0366, we may lower our invalidation point to 1.0499.
Alternate Daily Wave Count
This alternate daily count sees that blue wave 2 is forming an expanded flat labeled pink waves a, b and c.
Within it, pink wave a formed a double combination labeled green waves (w), (x) and (y).
Pink wave b formed a zigzag labeled green waves (a), (b) and (c), retracing a little over 138.2% of pink wave a.
This count expects the euro to start moving towards the upside in pink wave c to complete blue wave 2. This will be confirmed by movement above 1.0670.
At 1.0708 pink wave c would reach 100% the length of pink wave a, then at 1.0929 it would reach 161.8% of its length.
This wave count is invalidated by movement above 1.1300 as blue wave 2 may not move beyond the start of blue wave 1.