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EUR/USD-Selling The Pull-backs (Elliott Wave)

European stocks are higher today, and helped some major currencies to hold the support against the US dollar. Over the past few sessions we could also saw some of Eur recovery, supported by the comments coming from Japan which may buy 20% of euro zone bonds in this month to help the Europe in debt crisis. With this being said, we may finally see an upward correction on Eur/Usd that may offer a short opportunity.

A significant resistance zone on any pull-back is at 1.3050-1.3150 region, where a trend line connected from August 2010 and 200 day SMA should react as a very good level for a downtrend continuation”¦if pull-back appears.

Guest post by  Gregor Horvat.

In fact, on dollar index 1h chart, we can see that trend from 78.79 region is incomplete. In Elliott Wave theory an impulsive legs are structured by five waves, where a third wave is usually the most powerful wave in that sequence. On the chart below we can definitely say that move from 78.90 is a third wave, and as such, a current pull-back from 81.30 should be only a corrective wave (iv), with wave (v) yet to come. In the near-term, traders should   watch out for support levels around 80.25/40 region where wave (iv) may finish and send the Eur/usd lower from 1.3050/150 region as mentioned above. We are bullish on the US dollar index as long as the market trades above 79.52 critical region.

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Gregor Horvat

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!