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OK, we have seen enough, AUD/USD is not falling in wave (v) as we firstly thought, but its more likely in wave (iii).

Why!? Its because of the price action personality, which helps us to label the chart in a correct way. In wave five you will tend to see slow moves with decreasing volumes and divergence on a lot of oscillators/ indicators.

Guest post by Gregor Horvat

Well, in a current sell-off indicators are pushed into new extreme levels with increasing volume, which means only one thing; continuation of a larger trend which is clearly bearish!

So if we believe that pair is falling in wave three of an impulsive move then more weakness to come, because impulses are structured by five waves! Corrective rallies should be an opportunity for shorts.

AUD USD Elliott Wave September 22 2011

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