The price action in the markets during the last weeks has been amazing, and we see history. All analysts are amazed; every day comes with unprecedented news. All this chaos is a delicacy for technical traders is one of the best times in recent years to trade and make some good money. Thanks to the Elliott Wave theory, we can understand the price cycles and plan excellent trades.
The trader’s career comes with a lot of good and bad moments, when observing a high probability trade, the emotion begins to run through the veins. I am not saying that we should trade with emotions, but seeing a perfect trade from a technical point of view, we will always feel some pleasant emotions when we find it.
Elliott Wave analysis in the EUR / USD
To begin, let us look at the daily chart to understand the context of the market. In this chart, our main Elliott count shows that the current wave corresponds to the “iv” wave (black); the price is drawing an ending diagonal wave. In this time frame, we can expect an upward movement to hit 1.1190. Once the fourth wave is over, we will look for a new low below 1.0925.
Elliott Wave Daily Chart
The price of the EURO has been shown as a roller coaster (literal) in recent weeks, on the 4-hour chart, notice how the wave “A” (red in a circle) ends at resistance 1.1084. The “B” wave (red in a circle) appears from nowhere and takes the price to support 1.0926, bounces and rises to 1.1109. Incredible but, will it be enough to find a trade?
4 – Hours Chart Elliott Wave
The EURO against the US dollar is one of my favorite pairs this week. A purchase will be the trade I am looking for, but before you start looking for it, the price must fall a little more. Already managed to impact the Fibonacci retracement 61.8% (1.0996), now must visit 78.6% (1.0947), it can even reach 88.6% (1.0947). When this happens, I will start looking for the setup to validate the end of the wave. I share all my trades with my clients. I recommend you sign up for our membership.
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Dollar Index Elliott Wave
Last week I surprised my clients with an instrument in our daily reports, this is the Dollar Index, a financial instrument that measures the strength of the US Dollar and serves to confirm other trades, and can even be traded directly.
4 – Hours Chart Dollar Index
We can see that the wave “iv” (black) is active, its objective is 97.36. Its internal structure corresponds to a double ZigZag WXY (red), we see the development of the “Y” wave (red), due to the fractal nature of the market inside we have three “ABC” waves (orange). Wave “B” is active, and when it is finished, a drop below support 97.56 is expected.
The validation of the end of the “B” wave (orange) will be quite useful to confirm the long trade in the EUR / USD.
I wish you a week full of positive trades and the best energy so that everything goes well.