Eur/Usd: Bullish Aproach To 1.4444

Eur/Usd

Weekly chart trend: Mixed. Main price points: 1.3805, and 1.6036. Looking for: Wave (X) top

On the Eur/Usd weekly chart prices fell sharply in the middle of 2008 from the 1.6036 high, down to the 1.3805 area. The price structure of that move was completed with three waves followed by a sharp gain in wave A/1. However, the price structure looks complex as the market may react with another leg down in wave Y if the current prices are trading in wave (X). The possible wave (X) was labeled because of the very choppy and slow price action, which has a personality of another correction from the wave (W) lows to current levels.

If a move through the 1.3805 lows happens then we will be looking for wave (Y) targets, somewhere around 1.1500. However, the next expected step in the current market conditions is a temporary turning point of a recent up-trend, especially if the lower black support line gets broken.

Daily chart trend: Mixed. Main price points: 1.4444. Looking for: Wave 5

On the daily chart shown below, we are looking for a higher wave 5 target of a red wave C, as the market is trading higher and higher, driven by higher commodities and equities in the last few days. The prices are also threatening our critical resistance area at 1.4326, discussed yesterday, where it could lead into a 1.4444 breakout. This breakout will confirm a more complex and larger wave 5 structure where an ending diagonal is also one of the valid scenarios.

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