Elliott Wave Analysis On EURUSD And AUDUSD
EURUSD found some support earlier at 1.0985 where pair might have accomplished a five wave decline of a lesser degree, so looks like that new corrective bounce can be now in play. We will be tracking an A-B-C bounce back to 1.1060-1.1098 area from where downtrend could resume after wave 4) for a new fall down into wave 5).
AUDUSD hit new lows at the start of the European session but bounced quickly with nearly 60 points, which makes us think that corrective wave 2) is still coming. An updated count shows a leading diagonal after which we need three legs up back to 0.7600 area before we may expect a new impulsive leg down.
When diagonal triangles occur in the fifth or C wave position, they take the 3-3-3-3-3 shape that Elliott described. However, it has recently come to light that a variation on this pattern occasionally appears in the first wave position of impulses and in the A wave position of zigzags. The characteristic overlapping of waves one and four and the convergence of boundary lines into a wedge shape remain as in the ending diagonal triangle. However, the subdivisions are different, tracing out a 5-3-5-3-5 pattern.
Basic Leading Diagonal Pattern: