- January 24, 2011
- Posted by: Ramki Ramakrishnan
- Category: Euro
After coming down twice to around 1.3400, the EURO recovered its poise and is looking strong again. So we discard our previous analysis ( that effort having served us well during the down move from 1.3538 to 1.3395) and go back to the charts again. Remember that Elliott Wave Analysis is always a work-in-progress.
The attached chart gives you my current thinking and while the peak at 1.3684 will act as a good resistance (being 400% of wave I), there exists a chance for a break higher to around 1.3743. So the trader who wants to take low risk positions would probably want to wait for that move. In the process he may end up missing a nice downmove should it start from the current top of 1.3684. So be it. I would rather miss a trade than get into a trade too soon.
The outlook for EUR/USD is thus some more sessions of strength followed by several more of a complex correction which will eventually take it down to 1.3560. Later on, we will likely see a final push capable of taking it above 1.3800, but we will reserve our judgement on the likelihood of that happening till later.