EUR/USD forecasting the rally after Elliott Wave zig zag pattern

In this technical blog we’re going to take a quick look at the Elliott Wave charts of EURUSD, published in members area of the website.  As our members know, recently EURUSD made a pull back that has had a form of Elliott Wave Zig Zag pattern.  We expected the pair to find buyers at the extreme zone from the 01/26 peak. In the further text we are going to explain the Elliott Wave Pattern and the forecast

Before we take a look at the real market example, let’s explain Elliott Wave Zigzag.

Elliott Wave Zigzag is the most popular corrective pattern in Elliott Wave theory . It’s made of 3 swings which have 5-3-5 inner structure. Inner swings are labeled as A,B,C where A =5 waves, B=3 waves and C=5 waves. That means A and C can be either impulsive waves or diagonals. (Leading Diagonal in case of wave A  or Ending in case of wave C) . Waves A and C must meet all conditions of being 5 wave structure, such as: having RSI divergency between wave subdivisions, ideal Fibonacci extensions and  ideal retracements.

At the chart below we can see what Elliott Wave Zig Zag pattern looks like in real market.

EUR/USD H1 London update 01.31.2023

EURUSD is giving us pull back against the 1.048 low. Correction looks incomplete at the moment. First leg has a form of 5 waves, so we assume pull back is unfolding as Elliott Wave Zig Zag Pattern.  That means both ((a)) and ((c)) legs should have a form of 5 waves structure.  At this stage ((c)) leg is still missing another wave down . We are calling for another marginal push lower toward marked reversal area: 1.0820-1.0763 ( buyers zone). That area we got by measuring extreme zone with Fibo Extension tool ((a)) – ((b)). At that zone sellers will be taking profits and we expect buyers to appear for further upside toward new highs ideally.

EUR/USD H1 London update 02.01.2023

The pair is giving us nice reaction from the marked zone and we count 2 red red pull back completed at 1.0799 low. Now, as far as the price holds above that low we expect to see further extension higher  and break above 1 red high : 01/26 to confirm next leg up is in progress.

EUR/USD H1 London update 02.02.2023

The pair made further rally as expected. We got break of  1 red ( 01/26) peak, confirming next leg up is in progress. EURUSD can remain supported in near term as far as 1.0800 pivot holds. It should ideally keep finding buyers in 3,7,11 swings.