The EURO against the US dollar is currently trading at 1.0976. During the week, the price impacts support at 1.0879 and rebound to resistance 1.0973. Will the downward trend continue, or will be a bullish reversal. In this article dedicated to the Elliott Wave analysis in the pair EUR/USD, we will propose a high probability scenario.

Most independent traders become disoriented when they analyze their charts, causing investment decisions to be made based on emotions and resulting in random trading. The rookie trader becomes obsessed with reaching the decision point. Dodge the analysis to prepare the entry, and the result is dire. Loss after loss and risking an alarming percentage of the capital.

A series of unfortunate mistakes result in a capital loss. To regain control in your trading, use Elliott Wave because it allows understanding the price behavior. The result of the analysis is combined with the validation strategy and results in a high probability trade.

Live case of study Elliott Wave EUR/USD

The main Elliott Wave count indicates that the price is making an ending diagonal wave. Denoted in black “i, ii, iii, iv, v” in the four-hour chart, the fifth wave “v” in black is active. Inside it appears an “ABC” in red. In this case, the Elliott Wave theory allows to label as ABC each of the five waves because it is an ending diagonal wave.

The “C” wave in red of the ZigZag is in development and has five waves inside. An ending diagonal of five waves in orange. Today’s bullish swing corresponds to the fourth wave (4) in orange, at the end of the fourth wave, the fifth wave will begin. The target for the “(5)” wave in orange is in the zone 1.0880 / 1.0850.

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4-hour chart Elliott Wave EUR/USD

Elliott Wave by Juan Maldonado

What will happen at the end of the cycle?

The end of the bearish cycle is approaching, and the validation will be through five upward waves. It will be the beginning of a weekly wave, and the first estimates result in a target close to 1.2100. It is not possible to know the reverse before seeing the bullish impulsive wave.

Trading Plan

Let’s look for the end of the fourth wave in orange to take a short. Objective 1.0880, the administration of the trade is crucial to avoid losses that put the entire business at risk. When the price manages to finish the bearish cycle, we will be looking for the long validation. We wish you success in all your transactions.