EURO - THE CRASH
Elliot
Wave Count
|
Wave
|
Start
|
|
End
|
|
Difference
|
%
|
|
|
|
-
|
|
|
|
|
|
I
|
1.4545
|
-
|
1.3145
|
|
0.14
|
100
|
|
II
|
1.3145
|
-
|
1.4245
|
|
0.11
|
78.6
|
|
III
|
1.4245
|
-
|
1.2625
|
|
0.162
|
115.7
|
|
IV
|
1.2625
|
-
|
1.3485
|
|
0.086
|
61.4
|
|
V
|
1.3485
|
-
|
1.2045
|
|
0.144
|
102.8
|
|
|
|
-
|
|
|
|
|
|
A
|
1.2045
|
-
|
1.317
|
|
0.1125
|
78 of Wave V
|
|
B
|
1.317
|
-
|
1.266
|
|
0.051
|
36 of wave A
|
|
C
|
1.266
|
-
|
1.371
|
|
0.105
|
75 of Wave A
|
According to physical law: “Every action creates an equal and
opposite reaction”. The same goes for the financial markets. A price movement
up or down must be followed by a contrary movement, as the saying goes: “What
goes up must come down”( and vice versa).
Price
movements can be divided into trends on the one hand and corrections or
sideways movements on the other hand. Trends show the main direction of prices,
while corrections move against the trend. In Elliott terminology these are
called Impulsive waves and Corrective waves.
The Impulse wave formation has five distinct price movements,
three in the direction of the trend (I, III, and V) and two against the trend
(II and IV).
From the above Graph; Elliot
Wave Pattern has been clearly ploted and have also seen both Impulsive waves and Corrective wave’s completion. Looking at the bigger picture we have seen fall from
the higher level point A at 1.4545 after consolidation at higher level and
tested the lower level point B at 1.2045 where the five wave completion was
seen and there after corrective a-b-c patter brought it to Point C where it
tested the level of 1.3710. Taking the retracement of the fall of point A to
Point B; point C comes exactely at 61.8% and if market fails to cross the
higher level point C at 1.3710; reversal is expected from here it is expected
market may move to test the 100% extension of the fall from point A to Point B
from point C which comes to 1.1200 level. Currentely its trading at 1.3400 and can
start its down trend where the fundementals of the Economy is also not that
strong for the financial year 2013 and 2014; I feel some good downsdie move is
expected and sharp correction can be seen in due course.
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