Monday, April 5, 2010

EUR/USD in 3 Waves...

Action since last week has been very choppy. The move up from 1.326 does not look impulsive. This is good news for the Euro bears and bad news for the bulls. I have changed the short term counts a bit and the yellow short term trendline (still not a high level of confidence in this channel yet), although neither of these changes significantly affect the forecast. There are numerous ways to label short term counts, but the bottom line is that the move up appears to be of the 3 wave variety.

There may still be more upside, as I still think it is possible for us to reach the upper blue trend channel in a triple diagonal move (see last weeks ending diagonal speculation post), even in the primary overall bearish count I am watching. We may drift lower to touch the yellow in more of an X wave before heading up to an ending Z, but this is very specuylative. 1.3382 is a critical point in the short term counts, and should we breach here, we likely head down to new lows.

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