EUR/USD – Moving lower in a corrective AB=CD formation

Ian Coleman FXStreet

Technical

Monthly: Trading within a bearish channel formation. Trend line resistance is seen at 1.2408. Levels close to the 38.2% pullback level of 1.2522 (from 1.6038-1.0349) found sellers. The move lower is mixed and volatile common in corrective formations.

Weekly: Completed a bearish Elliott Wave count to the downside (5-waves completing at 1.1216). Price action on the week 12th November posted a bullish engulfing formation close to the 61.8% pullbacks level of 1.1186 (from 1.0340-1.2556).

Daily: Yesterdays price action posted a bearish Outside Day, often an indication that a top is in place. A full AB=CD corrective formation would take the pair to 1.1240. With a stop placed under the 61.8% pullback level (weekly chart), buying dips offers a reasonable risk/reward set up.

We look to Buy at1.1240

Stop: 1.1140

Targets:1.1580 and 1.1620

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Author

Ian Coleman

FXStreet

Ian started his financial career at the age of 18 working as a Junior Swiss Broker at Godsell Astley and Pearce (London). He quickly moved through the ranks and was Desk Manager at RP Martins at the age of 29.

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