EURUSD remains below 1.14 after negative Eurozone growth data. Market now eyes US consumer confidence data coming later today. What are the levels to watch out for?
October 2018 | AtoZMarkets – EURUSD has moved slightly downside today, hanging between 1.13 and 1.14 handles after Eurozone data miss. Eurozone GDP for Q3 with 0.2%, came less than expected. Italy growth was also recorded at 0% amid their budget face-off with the EU. US consumer confidence data coming later today is expected to drop to 136.3 from the previous 138.4. Will Euro break below 1.13 or rally back above 1.14?
EURUSD has been bearish since the beginning of this year. The bearish move is morphing into an impulse wave. Impulse waves are 5 non-overlapping waves that can be used to measure how far a trend has gone and how far it has left before a major correction. The year-long bearish impulse wave started the 5th wave late September at 1.182. from 1.182, price has dropped about 500 Pips since the 5th wave began. Last week, Euro was 30 pips shy of the important 1.13 support handle. In the later end of last week, price hit back at 1.14 but has dropped back to mid-1.13s. High impact events like today's US consumer confidence data and Friday's US employment data might give the needed momentum to drive Euro far above 1.14 or far below 1.13. From Elliott wave perspective, it seems the bearish trend still has a better chance to continue.
EURUSD Elliott Wave Analysis and Important Price Levels
The chart above shows the year-long impulse wave from 1.255 top in mid-February. The 4th wave ended in late September at 1.182 with a zigzag pattern and price has dropped since then. The 3rd subwave of the 5th wave is still developing. If price completes this impulse wave, the bearish trend will continue into the first quarter of year 2019. The bearish target is earmarked at 1.1-1.0 – talk of Euro-dollar parity. The technical forecast is quite possible if the Euro-zone frailties and the Dollar strength continue in the coming months. Meanwhile, on smaller degree, yesterday's forecast is still relevant as market awaits consumer confidence data from the U.S.
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