One can make a very credible argument that the Euro has completed the first wave of the move down from the November high of 1.4141. The daily chart shows an almost classic wave pattern. In this case, wave B ended with the low of 1.3114 on Tuesday and we're beginning the C wave up. C waves are third wave—that means they're powerful. The C wave must be an impulse or ending diagonal so expect it to break down into five waves. The potential target is 1.3818. There's some positive divergence on the daily chart which lends support that this move will continue up a bit. However as I noted the other day, there's lots of indecision and bearish sentiment on this pair. If the pair begins to break down below 1.3114 would negate this interpretation.
I've notated the daily chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
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