EURUSD—beginning downward move

One can trace out a five-wave decline on the three-hour chart from the 1.3335 high down to the 1.2734 low. If that's a good interpretation then Euro is currently correcting. (There's another possibility that the pair hasn't finished the drop down within the wave iv (circle) but we'll have to wait to see if that's true). The positive divergence on the 3-hour chart supports my five wave down interpretation. So where will this bounce take it? Possibly as high as 1.31 but I'd begin to look for faltering at 1.2958 which is the prior uptrend line from late June that price broke below. 1.2763/87 is good support both in price and because it's the 100 daily SMA.

Here's the three-hour 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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