NZDCAD has been on a long term steady bullish corrective move. In this article, we will look at the long term corrective pattern presumed to have completed. More important is an intraday corrective pattern about to complete to give a bearish setup that could give more than 500 Pips. All these based on 26 June NZD CAD Elliott wave analysis.
26 June, AtoZForex – There is a clear difference between a motive wave and a corrective wave according to Elliott wave theory. Motive waves are reversal patterns while corrective patterns are continuation patterns. Reversal patterns often lead to change in the direction of the prevailing trend while continuation leads to price resuming the direction of the previous trend. Being able to spot these patterns on any time frame is key to profitable trading over the short and long term. We will study the price charts of NZDCAD and see what pattern is evolving and the expected price reaction.
26 June NZD CAD Elliott wave analysis: what pattern?
The chart below shows the weekly view of NZDCAD.
From 2009, price has advanced in a corrective manner. This shows that, at a point, the bearish trend will resume. How do we anticipate this?. Simple. Wait till a corrective pattern is complete. The chart above shows a complete triple zigzag pattern. Triple zigzags are complex and deep zigzag patterns made up of three zigzag patterns separated by corrective sub-waves.
The chart above shows the pattern completed at 0.976, now a good resistance. A dip followed and then sub-corrective wave to 0.969 before showing signs of further drops. It seems price will resume a large corrective pattern downside or an impulse wave. The pattern that will unfold downside can’t be know until price shows us. The good thing is that: we have a clue for a bearish move that can get to 0.91 before price starts. Check the chart below to know the corrective pattern formed to 0.969.
Does the pattern above look familiar?. That’s a zigzag a-b-c pattern. The a-wave is impulse, b-wave is a triangle and c-wave is an emerging ending diagonal. This pattern will be invalidated if price drives above 0.97. If price moves as expected, this should give 500 Pips at least. Stay tuned at AtoZForex as we reveal high probability and very profitable Elliott wave patterns.
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