AUDUSD In Impulsive Uptrend: Pull-back Could Be Opportunity

AUDUSD is looking bullish after yesterday's sharp rally which was most likely wave three of a five wave rally in black wave 3. Wave 3 must be made by five smaller waves so we favour more upside on AUDUSD, towards 161.8%; a typical third wave target measured from waver 2 low. With that said, current slow price action around the high is most-likely wave (iv) in 3, so break higher could follow very soon into wave (v). Nice support comes in around 0.9460 from where any long positions could be considered, but stops should then be below 61.8%. If new high will occur then new opportunity should be in wave 4 of one larger degree.

Impulse is the most common motive wave. Most impulses contain what Elliott called an extension. An extension is an elongated impulse with exaggerated subdivisions. The vast majority of impulses contain an extension in one and only one of their three actionary subwaves.
  • wave 1 must be an impulse or a leading diagonal
  • wave 2 can be any corrective pattern except a triangle
  • wave 2 must not retrace more than 100% of wave 1
  • wave 3 must be an Impulse.
  • wave 3 must be longer than wave 2
  • wave 4 can be any corrective pattern (zig-zag, double or triple zig-zag, triangle, flat, double or triple three)
  • waves 4 must not trade into a territory of a wave 1
  • wave 5 must be an impulse or an ending diagonal
  • wave 3 must never be the shortest wave when compared to waves 1 and 5.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Forex involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.