Elliott Wave Analysis: NZDUSD Trading In Final Stages Of A Correction; A Reversal From Around 0.7264-0.7269 Could Be In View
|NZDUSD is trading nicely higher within a higher degree corrective rise, that we labeled as an unfolding A-B and now in final stages wave C. As we can see on the intra-day time frame, we are now observing a five wave development taking place in wave C, that could ideally unfold as an ending diagonal pattern; a strong reversal pattern that can after its completion push price lower. For now price could be trading at the start of sub-wave v and could later if price continues to the upside, face a possible reversal around the 0.7264-0.7269 area.
A daily close below the 0.7102 level would be a confirmation for a top in place and more weakness to follow.
NZDUSD, 1h
The ending diagonal is a special type of motive wave that occurs primarily in the wave 5 position when price has moved too far and too fast. Some ending diagonal triangles appear in the C wave of an ABC correction. In all cases, the ending diagonal terminates the move of larger patterns. They consist out of five waves, with each having three more sub-waves.
Basic Ending Diagonal Pattern:
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