Euro expected to continue south against the dollar

November 13, 2015 09:12 AM

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EURUSD fell sharply lower in the last few weeks with accelerating price action which confirms a continuation of a downtrend. We see huge possibility for wave (3) in progress that is part of a big five wave move within wave V that began unfolding at the end of September, away from 1.1700. Based on current very strong bearish momentum we may see extension towards 1.0400 this year, where we see Fibonacci projected levels for wave (3). As long as price trades beneath 1.1082 trend is down.

EURUSD, Daily

On the 4H chart, EURUSD made another strong leg down last week when price broke well beneath wave 1) swing low, through 1.0900 which suggests that pair is now in a red wave 3). Third waves are usually the strongest so we stay bearish on EURUSD for now towards 1.0600 that can be seen in the next couple of days as black subwave 4 can be near completion. Invalidation level is at 1.1070; as long as this level holds trend is down, but we will likely change our view if pair would go back above 1.0900.

EURUSD, 4H

About the Author

Gregor Horvat, based in Slovenia, has been in the forex markets since 2003. He is a technical analyst and individual trader who has worked for Capital Forex Group and TheLFB.com. He also is founder of forex services on www.ew-forecast.com. EW-Forecast.com provides technical analysis of the financial markets, highlighting behavioral patterns based on the Elliott Wave Principle (EWP). Website: http://www.ew-forecast.com/