On November 9, I suggested in these pages that the high at 1.4281 was probably an irregular B wave and so after a brief downmove, we should look for a move higher from 1.3650 (with1.3570 being the outer limit of the so-called correction). Any casual reader who looks at the prices once in a while will probably smirk when he sees that the Euro is currently trading around 1.3250, just about ten big figures lower than the target of 1.4250 mentioned only two weeks ago. We shall not try to rob him of his pleasure. However, for those who have not lost faith in the Wave Principle, this is a valuable lesson. First of all we should recognize the secret of markets, which is…there is no secret and there never will be. There is no touchstone. There is no ‘guru’ who can tell you the market will do this and be right all the time. What is true, however, is Elliott Wave principle comes closest to what a serious trader or investor really needs to be successful in the markets. Take my most recent analysis. Did we not get a 150 pip rally from near 1.3650 and another 200 pip rally from 1.3570? WHat should you do if the markets turn around AFTER producing those rallies and breaks your first support? You will re-assess the situation, right? It doesn’t matter if Ramki is away on holiday. The markets are there, with a zillion traders still buying and selling as if there is no tomorrow! So, when a new development happens that is not in line with the original analysis, we should go back to the charts and think through the wave counts. Try it yourself today and I will present you with my version in a couple of days. Good luck.
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Good Day Ramki,
Regarding the Euro, my thoughts are that the 5th wave was completed at 1.428. That we are currently finishing off wave C of the ABC correction, and for the upside to resume again from point 1.2953.
That level (1.2953) would mean that Wave C is exactly equal to Wave A that ended at 1.3445. My concern is that Wave B was only 38.2% of wave A, where as in most books, they state that wave B must be ‘at least’ 50% of wave A.
That said, i will be long should that level be hit, with a stop of course. I think the Bearish sentiment on the Euro right now is perfect for the start of a new 5 wave that can take us maybe towards 1.6 next yr.