The euro accelerated to the upside vs. the dollar in the last few weeks and touched 1.3700 a few days back, which means the pair is trading extremely close to its January high. It seems that a rally from the 2012 low is still unfolding. We are tracking an update that shows a completed running triangle in wave (B) followed by a recent push out of the pattern that is now pointing higher, for a five-wave rise in wave (C) toward and above 1.4000.
Keep in mind that this long-term view is only a guide to our short-term trades.
On the 4h chart below we can see that EUR/USD accelerated sharply to the upside in the last 24 hours after a break-out of a downward corrective channel, which was a trigger for a bullish move. As such, current trend is up, but as always pull-backs will occur in the middle of an uptrend that could be an opportunity to join the trend. We suspect that pair will reverse back in wave (ii) early next week before new strong move higher occurs.
Elliott Wave Education: Triangle Pattern
A Triangle is a common five-wave pattern labeled A-B-C-D-E that moves counter-trend and is corrective in nature. Triangles move within two channel lines drawn from waves A to C, and from waves B to D. A Triangle is either contracting or expanding depending on whether the channel lines are converging or expanding. Triangles are overlapping five wave affairs that subdivide 3-3-3-3-3.
- Structure is 3-3-3-3-3
- Each subwave of a triangle is ussaly a zig-zag
- Wave E must end in the price territory of wave A
- One subwave of a triangle usually has a much more complex structure than others subwaves
- Appears in wave four in an impulse, wave B in an A-B-C, wave X or wave Y in a double threes, wave X or wave Z in a triple threes