EURUSD has turned bearish at the start of January from 1.3900 spike high which we assumed it represents final part of a bullish trend. From there market fell sharply lower almost 400 pips so we assume that pair has completed an ending diagonal. However, a key for a breakdown would be move through the red wave 4) swing low that is placed around 1.3300 figure, still far away from current levels.
EURUSD Daily Elliott Wave Analysis
As expected, the EURUSD has turned down from above 1.3700 area where we labeled end of an expanded flat formation that now shows signs of completion after sharp fall down to 1.3530. Current decline is showing signs of an impulsive pattern so we suspect that EURUSD is heading south. Trend is down as long as 1.3683 remains in place.
EURUSD 4h Elliott Wave Analysis
Elliott Wave Education: Flat Pattern
A Flat is a three-wave pattern labeled A-B-C that generally moves sideways. It is corrective, counter-trend and is a very common Elliott Wave pattern.
- Structure is 3-3-5
- Wave B moves beyond the start of wave A
- Wave C ends more substantially beyond the ending level of wave A
- Appears in wave two or four in an impulse, wave B in an A-B-C, wave X in a double or triple zig-zag, or wave Y in a triple threes