Euro-Crosses Could Extend Even Higher In Risk-On Environment

Euro-Crosses Could Extend Even Higher In Risk-On Environment –

The USD dollar has been trading higher against its rivals during the Asian trading hours. AUD, GBP and CAD are still the weakest while JPY is trying to find some support for the near-term. The larger picture of the markets remains unchanged but still very messy.

Below we have an overlay chart between some major FX currencies compared to S&P Futures and Crude Oil. We can see a strong negative correlation between FX pairs where only the EUR is moving higher in-line with risk-on assets, such oil and S&P.

Honestly, we do not like divergences too much, especially not between the Aussie and S&P which in fact could be signaling for a coming pull-back on stocks.

Overlay-Daily

Anyhow, traders need to trade what they see and not what they think, so at the moment looking for longs on EUR-crosses should be the best choice.

Below we are looking at EURCAD which is trading higher in wave (iii) that may slow down around 1.3630. Ideally we will see a fourth wave pull-back from there and back to 1.3500 which could be a long opportunity for short-term traders to catch wave (v) rally.

EURCAD 1h

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Gregor Horvat

Grega Horvat Grega is based in Slovenia and has been involved in markets since 2003. He is the owner of Ew-Forecast, but before that he was working for Capital Forex Group and TheLFB.com. His feature articles have been published on FXstreet.com, Thestreet.com, Action forex, Forex TV, Istockanalyst, ForexFactory, Fxtraders.eu, Insidefutures.com, etc. He recently won the award on FXStreet.com for Best Forex Analysis in 2016. At Ew-forecast he helps clients and educates them about the Elliott wave principle and how to label and track unfolding patterns in real time. His approach to the markets is mainly technical. He uses a lot of different methods when analyzing the markets such as candlestick patterns, MA, technical indicators etc. His specialty, however, is Elliott Wave Theory which could be very helpful especially if you know how to use it in combination with other tools/indicators. EW-Forecast To be involved in the market effectively, you need the right guidance and resources, and our team can help you to achieve that. Our team is providing advanced informations about Elliott Wave theory in real time. The Elliott Wave Principle gives you a method for identifying the behavior of the markets and at what points the market is most likely to turn. We help new traders who are interested in Elliott Wave theory to understand it correctly. We are doing our best to explain our views as simple as possible with educational goal, because knowledge itself is power!

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